Debt or Savings

With some spare money each month, you can put it on the debt, build a cushion, or split it. This calculator runs all three and shows which finishes both jobs first.

On pure arithmetic, paying the debt almost always wins, because 22% interest beats 4% every time. What arithmetic can't see is that someone with no cushion puts the next car repair back on the card. So this calculator shows you all three orderings rather than one rule, and leaves the choice with you.

Inputs

Debts

Tap Add a debt for each one, with its balance, rate, and Minimum. You need at least one. Minimums are always paid, and the spare money goes on top.

Spare money

Spare each month: what's left after every minimum is paid. This is the amount the three plans divide up differently.

Hybrid, Avalanche, or Snowball: the order debts are paid off in, the same choice as in the Debt Payoff Calculator.

The cushion

Target: the savings you want in the end.

Starter cushion: a smaller amount to keep on hand while you pay debt down. Left blank, $1,000 is used, or your target if that's lower.

Saved so far: what you have now.

Interest on savings: the APY your savings earn.

Then tap Compare.

The three orderings

1. ›Debt first: everything spare goes at the debt, then you build the cushion.
2. ›Starter, then debt: a small cushion first, then the debt, then you finish the cushion.
3. ›Savings first: the cushion goes to its target first, paying only minimums on the debt until then.

What you get

Debt gone and cushion full in, for whichever ordering gets there soonest, with a note on why it won. Beneath it are when you're Debt-free, when the Cushion is full, and the total Interest.

All three orderings follow, each with its own debt-free date, cushion date, and interest. The fastest is marked Fastest. When two tie, the one with less interest wins.

Which to pick

The fastest ordering isn't always the one to choose.

Debt first usually wins on the numbers, but it leaves you with no cushion for the longest. One bad month on a card can undo the difference.

Starter, then debt often costs only a little more and protects you from the surprise that sends you back to the card. If you have no savings at all, it's worth a hard look.

Savings first makes sense when your debt is low-rate, or when your income is unpredictable enough that cash on hand matters more than interest saved.

Next

This calculator doesn't have an Add To Budget button. Once you've decided, put your debts in the Budget Builder and let the plan sequence them. For the size of the cushion itself, use Emergency Fund.