How Long Will It Take to Pay off a Debt or Loan

When you have a loan, whether new or old, it’s important to know when you will have it paid off, especially if you’re goal is to become debt free. Listing and analyzing your debts [link to article, “Which debts should i pay off first”?] will help you get a clear picture of your financial situation and create a realistic plan to get you out of debt sooner.

While loans like a mortgage give you a date in which your loan will be paid off, some debts like credit cards do not. In order to figure out the pay off date, you need to know your current balance, interest rate, and current payment amount. A calculator offered by allows you to plug in these numbers to give you the year and date of your projected payoff. A more general calculator is offered here.

If you are making the minimum payment on a loan, you will often end up paying a significant amount of interest along the way. One way to lessen the amount of interest paid is to make payments larger than the minimum. See our other article [link to article, “Which debts should i pay off first”?] for some strategies to do this. Obviously, paying more than the minimum will change your payoff date. This calculator will allow you to see how adding extra money to your payment will change your last payment date.

Remember that paying off your high-interest debts sooner will also improve your credit score and free up some of your monthly cash flow so that you can save more. Knowing your payoff amounts and dates will help you create a realistic long term budget for yourself.

Kent Smetters

Kent Smetters is the Boettner Chair Professor at The Wharton School of the University of Pennsylvania, the Interim Faculty Director of the Penn Wharton Public Policy Initiative, and a Faculty Research Fellow at the NBER. He was the former Deputy Assistant Secretary of the U.S. Department of the Treasury, and he subsequently served as a member of the U.S. Congress’ bipartisan Blue Ribbon Advisory Panel on Dynamic Scoring. Kent holds bachelor degrees in Economics and Computer Science from The Ohio State University as well as an MA and PhD in Economics from Harvard University. He previously cofounded a national registered investment advisory firm that built a new technology platform, grew the firm to over 50 advisors and then sold the firm to a large, publicly-traded company. Growing up in a financially poor family, Kent donates his time to “Your Money” to help families work, save and set goals in order to achieve the most in life. Kent is often cited in major news outlets.