The weight on my chest was feeling heavier by the second. I pulled over to the side of the road. The headlights of passing cars flashed on the side mirrors, distorted by the spots of rain. It was 8:07pm. I’d left work a few minutes before. My pulse was hammering in my ears. The weight on my chest got heavier. Then the dark thoughts came in earnest. I think I have enough life insurance. If I’m gone, the debt will be gone. Maybe that would be best. My pulse got louder. The weight got heavier. And I started to see memories of my family. There was my daughter, flying like an airplane on my feet, laughing with freedom. My son, riding on his bike the very first time. On the Santa Monica pier with my wife, giggling in a photo booth.
That wasn’t the first time I had similar thoughts. I ended up driving away that night. Maybe it was the happy thoughts boosting my serotonin just enough to keep me going. Maybe it was a guardian angel. But I drove home, got in my bed, and started looking on my phone for ways to get out of debt faster. I had to take action. Feeling that way wasn’t going to lead to anything good. It was total hell.
I came across a plethora of websites about how much student loan debt people have—and how people are getting out of it. How one guy killed $90k of student loan debt in seven months. How another woman rapidly crushed $81k of student loan debt by building a blog and freelance writing. And I realized there is a whole community of people dealing with student loan debt. I had felt so isolated, and hopeless. Yet these people were eliminating massive amounts of debt in periods of time that seemed unbelievably fast. Seeing this community gave me hope. I knew I had to be a part of it. Maybe, just maybe, if I could learn enough I’d have a snowball’s chance of conquering my own debt.
Exploring blogs like those above and others, I found a ton of great advice. And on other financial sites, I found a few debt elimination calculators. And of course there are people like the Mad Fientist and Nick Marrone who provide calculators for people already out of debt and who are on their way to financial independence (and perhaps even early retirement). But I noticed there weren’t a lot of these great tools for people like me, still clawing their way out of debt. And the debt freedom calculators I found didn’t give a visual picture of what it looked like to pay off loans. Seeing is believing, and I needed to see it. So I endeavored to create my own.
The Debt Freedom Calculator Is Born
The debt freedom calculator has been on this website since launch, tucked away in a corner. But now it’s time to put in the full light of day, so you dear readers, can unleash its full motivating power! The concept behind it is simple: choose to pay off either your smallest loans or your highest interest rate loans first. Once one loan is paid off, take that payment and add it to the one you’re already paying to another loan. Then keep going until you have built up a truly massive payment for your last loan. The result cuts years off and the repayment schedule and saves tens—in my case hundreds—of thousands of dollars. The calculator shows you just how much. If you want your six figure pay day by adjusting how you’re repaying your debts, read on.
The first step is to enter your information for each loan—a name, the interest rate, how much you pay per month, and the total balance. Here’s what mine looks like at the moment:
You’ll notice the options at the bottom are “My Order,” “Pebble,” and “Boulder.” The first is obvious. Choosing Pebble directs the calculator to show the results for paying off the smallest dollar amount loans first. And Boulder is for paying off the highest interest rate loans first. You can easily switch between strategies to see the difference. Often the difference is minuscule. So if you are more motivated by having fewer loans, then by all means pay off those pebbles first! But if you like to see those boulders getting smashed to bits, then start with those big interest rate loans. Once you’ve made your initial decision, just click Calculate to reveal a beautiful chart:
You can see exactly when each loan will be paid off at your current repayment rate, and when you will be DEBT FREE! Adjust your payment rate in the form fields above and see how much time and money you save by paying more aggressively. If you’re ready to start using this tool already, just click here and give it a go.
You can also mouse over each line on the graph and see the loan balance at any given point in time for each loan, like so:
Want to see all the backup data for these charts? (If you’re a nerd like me, I know you do.) Got you covered:
Just click the + sign by each loan name to expand the full list of payments.
Looking at the above charts, which includes my mortgage, all $452,608 of debt will be gone by July 2024—barely more than 9 years from this writing. And that’s based on no pay raises, no bonuses, no side hustles, no other income. (A bleak picture!) But even with none of those improvements, I will be completely debt free in less time than the typical 10-year student loan repayment plan—and that’s starting with $200k of student loan debt and two car payments. (Refinancing my federal student loans with SoFi from a monstrous nearly 8% interest rate to just 4.06% was a huge first step on this path. You can read why I did so right here.) And my total interest will be a relatively minuscule $63k for all the loans—saving me hundreds of thousands of dollars. Now there’s a ray of brilliant sunshine.
You can claim these savings for yourself, too! And if you take the next step of generating a little DIY mojo, starting to negotiate better deals for yourself, and exercising your frugality muscles by learning to see abundance everywhere, and treat your debt like the emergency it is, you will really be on fire. (This time in a good way!) Who knows how fast you might repay those loans?
Debt can feel unmanageable, totally overwhelming. But there is a path out. And it’s faster than you ever thought possible—with all the talk of 20-year student loan repayment plans and 30-year mortgages, it’s easy to feel like you’re going to live in debt forever. I know firsthand how that feels. But there’s hope in numbers, and a plan. No matter how hellish it feels, you can start building your snowball today. Here’s yours: the debt freedom calculator. I hope it helps!
Has the debt freedom calculator helped you? Have suggestions to make it better? Please let me know in the comments below!