How to use the Debt Consolidation Calculator
- Enter the combined balance of the debts you would consolidate.
- Enter the weighted average APR you are paying now.
- Enter what you actually pay across those debts each month.
- Enter the consolidation rate and term, then compare total paid on both paths.
How the calculation works
Consolidation only saves money when the rate falls enough to offset any term extension. Moving 22% credit card debt to an 12% loan is a genuine improvement; stretching a three-year payoff into a six-year loan at a similar rate raises total cost even though the payment drops.
The current path is simulated month by month at your actual payment, which also catches the pathological case where the payment barely exceeds accrued interest and the balance never clears — a common trap with minimum payments on revolving credit.
The behavioural risk is real: roughly a third of consolidators re-accumulate card balances within two years, ending up with both the loan and the cards. Consolidation is a rate fix, not a spending fix.
Saving = Σ current payments to payoff − (new payment × new term)Source: CFPB research on debt consolidation outcomes; Federal Reserve G.19 consumer credit interest rate series.
Worked example
$24,000 at 21.9% paying $720 a month, versus 11.9% over 4 years.
- The current path clears in about 46 months, costing roughly $33,000.
- Consolidated, the payment is about $631 over 48 months.
- That totals roughly $30,300.
About $2,700 saved and a lower monthly payment — provided the cards stay unused.
Frequently asked questions
Will consolidating hurt my credit score?+
A small short-term dip from the inquiry and new account, usually followed by improvement as revolving utilisation drops.
Is a balance transfer better?+
Often, if you can clear the balance inside the 0% window. Beyond it, the go-to rate is typically worse than a consolidation loan.
Should I include my mortgage?+
No. Rolling low-rate secured debt into a consolidation loan almost always increases the cost.
Last reviewed September 1, 2026. We review this page whenever the underlying formula, tax year, published rate or standard changes.