Debt Consolidation Calculator
Debt consolidation rolls multiple debts — usually high-APR credit cards — into a single loan, ideally at a lower interest rate and with a single monthly payment that simplifies your finances and can free up cash flow. This calculator compares your current payoff plan, with your existing APR and monthly payment, against a consolidation loan with a lower APR over a set term, showing the interest you'd save and the new monthly payment you'd face. Enter your total debt balance, your current average APR, your current monthly payment, the consolidation loan APR, and the consolidation term, and the calculator returns the interest savings, the new monthly payment, and the change in total cost. Consolidation genuinely helps only when the new rate is meaningfully lower than your current blended rate and the new payment is affordable, because the savings come from the rate reduction, not from the act of consolidating. A longer term on the consolidation loan can lower the monthly payment even further but may raise total interest despite the lower rate, so check both numbers — the monthly payment and the total cost — before committing. Common consolidation options include personal loans, balance transfer credit cards with 0% intro APRs, home equity loans, and 401(k) loans, each with its own trade-offs in rate, risk, and tax treatment. The single biggest consolidation mistake is consolidating credit cards and then running up new balances on the now-paid-off cards, leaving you with both the consolidation loan and a fresh round of card debt — a trap that puts you in a worse position than before. Applying for a new loan causes a small, temporary dip in your credit score, but over the longer term, lower credit utilization and on-time payments on the consolidation loan help your score recover and improve.
Debt Consolidation Calculator
Compare your current debt payoff against a lower-rate consolidation loan.
Interest savings
$16,344
From a lower APR
Current plan: total interest
$23,000
80 months
Consolidated: total interest
$6,656
519/mo
Consolidation helps only if the new APR is meaningfully lower and you avoid recharging the cards you paid off. A longer term lowers the payment but can raise total interest.
How to Use This Calculator
- 1Enter your total debt balance.
- 2Enter your current average APR.
- 3Enter your current monthly payment.
- 4Enter the consolidation loan APR and term.
- 5Compare the interest savings and new payment.
Why It Helps
- ✓Quantifies potential interest savings.
- ✓Compares current vs. consolidated payments.
- ✓Shows whether consolidation is worthwhile.
- ✓Helps you choose the right consolidation term.
About This Calculator
Debt consolidation rolls multiple debts — usually high-APR credit cards — into a single loan, ideally at a lower interest rate and with a single monthly payment that simplifies your finances and can free up cash flow. This calculator compares your current payoff plan, with your existing APR and monthly payment, against a consolidation loan with a lower APR over a set term, showing the interest you'd save and the new monthly payment you'd face. Enter your total debt balance, your current average APR, your current monthly payment, the consolidation loan APR, and the consolidation term, and the calculator returns the interest savings, the new monthly payment, and the change in total cost. Consolidation genuinely helps only when the new rate is meaningfully lower than your current blended rate and the new payment is affordable, because the savings come from the rate reduction, not from the act of consolidating. A longer term on the consolidation loan can lower the monthly payment even further but may raise total interest despite the lower rate, so check both numbers — the monthly payment and the total cost — before committing. Common consolidation options include personal loans, balance transfer credit cards with 0% intro APRs, home equity loans, and 401(k) loans, each with its own trade-offs in rate, risk, and tax treatment. The single biggest consolidation mistake is consolidating credit cards and then running up new balances on the now-paid-off cards, leaving you with both the consolidation loan and a fresh round of card debt — a trap that puts you in a worse position than before. Applying for a new loan causes a small, temporary dip in your credit score, but over the longer term, lower credit utilization and on-time payments on the consolidation loan help your score recover and improve.
Disclaimer: This calculator provides estimates for educational purposes only and does not constitute financial, tax, or investment advice. Results depend on assumptions that may not reflect your actual situation.
Frequently Asked Questions
When does debt consolidation make sense?
When the new APR is meaningfully lower, the new payment is affordable, and you commit to not running up the old balances again.
Will consolidation lower my monthly payment?
Often yes, especially with a longer term. But a longer term can raise total interest even at a lower rate — check both numbers.
What are common consolidation options?
Personal loans, balance transfer credit cards (0% intro APR), home equity loans, and 401(k) loans. Each has trade-offs.
Does consolidation hurt my credit?
Applying for a new loan causes a small, temporary score dip. Long-term, lower utilization and on-time payments help your score.
What is the biggest consolidation mistake?
Consolidating credit cards but then running up new balances, leaving you with both the consolidation loan and new card debt.
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Written by
James MitchellSenior Financial Analyst & Personal Finance Expert
Certified Financial Planner (CFP) • MBA in Finance, University of Chicago Booth School of Business