Debt consolidation calculator

A debt consolidation calculator is a tool that helps you compare your current debt situation to what it might look like if you combined everything into a single loan. 

Here’s what the Ratehub debt payoff calendar does:

• Tallies your current debts, interest rates, and payments
• Projects how long it will take to pay them off if you continue on your current path
• Compares that to a new consolidation loan, with its own rate and term
• Shows you whether consolidating your debt will help you pay less interest, finish faster, or (in some cases) neither

Instead of juggling multiple due dates, using this debt consolidation calculator will tell you whether one predictable monthly payment will put you ahead. It provides side-by-side comparisons, so you can see if consolidation is worth it, along with an estimated timeline to pay off your individual debts.

First, you enter your debts, like credit cards, unsecured lines of credit, and personal loans, plus balances, minimum payments, remaining terms, and interest rates. Then you enter the details of a potential consolidation loan, including the interest rate, repayment term, and any fees.

Then, the calculator shows you two scenarios:

1. Current path: What happens if you keep paying your debts as they are
2. Consolidated path: What happens if you roll them into a single loan

How to read your results

Next, you’ll get one of three outcomes:

• Recommended: This means debt consolidation will clearly save you money, cut down your payoff time, or both.
• Neutral: Receiving a neutral recommendation means the difference is small, and you might decide to keep things the way they are.
• Not recommended: This means debt consolidation won’t help your situation, and you’re better off exploring alternatives.

It’s important not to take a not recommended result as failure. Instead, look at it as a recommendation to focus your energy elsewhere instead of wasting time on an option that won’t move you closer to your goals.

If you’ve ever wondered whether there’s a smarter way to manage your credit cards or line of credit, debt consolidation is worth a look. Maybe it’s becoming more and more difficult to keep up with your minimum payments, and you’re not sure exactly how much interest you’re accruing on your credit cards. Or maybe you’re curious whether rolling everything into one payment could actually make life easier. 

This calculator helps you find out, quickly, clearly, and without the guesswork.

It’s particularly helpful if you:

• Carry high-interest credit card debt
• Have multiple payments due at different times in the month
• Want to compare consolidation loans before applying
• Are worried about how long it will take to become debt-free

If you’re already laser-focused on becoming debt-free, you might just use this tool to confirm you’re on the right track.

Debt consolidation can be a smart way to get your finances under control, but it’s not the right move for everyone. In some cases, combining your debts into one payment can make life easier and save you money. In others, it might cost more in the long run or stretch your payments out too far. 

The chart below breaks down the main pros and cons:

If you’ve decided to explore debt consolidation, there are a few ways to go about it. 

One of the most common is through a personal loan. You borrow a lump sum large enough to pay off your existing debts, then repay that loan over time at a fixed interest rate. This approach makes sense if your credit score qualifies you for a better interest rate than what you’re currently paying on your credit cards. It also gives you a clear end date for being debt-free.

Another option is a balance transfer credit card. These cards often come with low or 0% introductory interest rates for a limited period (usually between six and 18 months). By transferring your high-interest balances onto this card, you can focus on paying down the principal instead of interest charges. The catch is timing: you’ll need to pay off as much as possible before the promotional rate expires, or you risk ending up right back where you started.

If neither of those fits, homeowners could look into a home equity loan or line of credit. These options use your home as collateral and can offer lower interest rates, but missed payments can put your property at risk.

When you consolidate debt, keep these points in mind:

• Avoid new debt while consolidating. Closing your credit cards temporarily or keeping them unused helps prevent you from racking up balances again.
• Compare total costs, not just monthly payments. A smaller monthly payment doesn’t always mean you’re saving. Stretching a loan over more years can cost more in interest overall.
• Read the fine print. Watch for balance transfer fees, loan setup charges, or penalties for early repayment.

If debt consolidation isn’t the right fit, you still have choices when it comes to paying off debt.

• Snowball method: This means paying off your smallest debt first, then rolling that payment into the next smallest debt. The snowball method is popular because it delivers quick wins, which gives savers motivation to keep going.
• Avalanche method: This approach encourages you to pay off the highest interest debt first, so you save the most money long-term.
• Debt management programs: Research the list of providers found through Credit Counselling Canada. These programs negotiate lower interest rates with creditors and teach you valuable financial literacy skills to prevent you from finding yourself in the same place down the road.

More calculators

• TFSA contribution room calculator
• RRSP limit calculator
• Credit card interest calculator
• Mortgage amortization calculator