The math behind your debt-free date.
How DebtFreeDate calculates when you’ll be debt free — and why the two methods produce different results.
DebtFreeDate runs a month-by-month amortization simulation. For each month it applies interest to every debt, distributes your minimum payments, then applies any extra payment to a priority debt determined by your chosen method.
The simulation stops when every debt balance reaches zero. The date of that final month is your debt-free date.
Priority order: smallest balance first
Each month:
1. Apply interest: balance += balance × (rate ÷ 12)
2. Pay minimum on every active debt
3. Apply extra payment to smallest remaining balance
4. When a debt reaches zero:
free up its minimum payment
roll it into the next smallest balance
5. Repeat until all balances = 0The Momentum method produces faster psychological wins. Eliminating a small debt early frees up cash flow and builds the habit of aggressive payoff. Research shows completion rates are higher with this method because early wins sustain motivation.
The trade-off: you may pay more total interest if your smallest balance carries a lower rate than a larger debt.
| Month | Attacked | Debt A | Debt B | Debt C |
|---|---|---|---|---|
| 1 | A | $1,763 | $4,992 | $9,850 |
| 2 | A | $1,525 | $4,983 | $9,699 |
| 3 | A | $1,285 | $4,975 | $9,548 |
| 4 | A | $1,044 | $4,966 | $9,395 |
| 5 | A | $801 | $4,957 | $9,242 |
| 6 | A | $556 | $4,948 | $9,089 |
Three debts: A = $2,000 @ 8%, $50 min · B = $5,000 @ 22%, $100 min · C = $10,000 @ 6%, $200 min · $200/month extra. Final result: 37 months, total interest $2,833, first debt eliminated month 9.
Priority order: highest interest rate first
Each month:
1. Apply interest: balance += balance × (rate ÷ 12)
2. Pay minimum on every active debt
3. Apply extra payment to highest-rate remaining balance
4. When a debt reaches zero:
free up its minimum payment
roll it into the next highest-rate balance
5. Repeat until all balances = 0The Optimal method minimizes total interest paid. By attacking the highest-rate debt first, less of each payment goes to interest and more to principal reduction.
Mathematically, this is always the cheaper path when debts carry different interest rates. The trade-off: the first payoff milestone may take longer, which can reduce motivation for some people.
| Month | Attacked | Debt A | Debt B | Debt C |
|---|---|---|---|---|
| 1 | B | $1,963 | $4,792 | $9,850 |
| 2 | B | $1,926 | $4,580 | $9,699 |
| 3 | B | $1,889 | $4,363 | $9,548 |
| 4 | B | $1,852 | $4,143 | $9,395 |
| 5 | B | $1,814 | $3,919 | $9,242 |
| 6 | B | $1,776 | $3,691 | $9,089 |
Same three debts and $200/month extra. Final result: 36 months, total interest $2,439, first debt eliminated month 21.
| Momentum | Optimal | |
|---|---|---|
| Debt-free date | Month 37 (May 2029) | Month 36 (Apr 2029) |
| Total interest | $2,833 | $2,439 |
| First debt paid | Month 9 (Debt A) | Month 21 (Debt B) |
| Best for | Building motivation | Minimizing cost |
Both methods reach the same destination. The difference is the path.
Choose Momentum if you have multiple small debts and need early wins to stay motivated. The psychological effect of eliminating debts is real and measurable.
Choose Optimal if you have high-rate debt (credit cards above 18%) and the mathematical outcome matters more than early milestones. The interest savings compound over time.
DebtFreeDate shows you both. Enter your debts, calculate, and toggle between methods to see exactly what each path costs — and how long each takes for your specific situation.