Add all your debts, set a monthly budget, and find the fastest path to becoming debt-free.
There are two proven frameworks for paying off multiple debts. The Debt Avalanche targets the highest-interest debt first — mathematically optimal, minimizing total interest paid. The Debt Snowball targets the smallest balance first, generating early payoffs that build momentum. Behavioral finance research shows that the psychological reward of eliminating a debt significantly improves follow-through. The "best" method is the one you'll actually stick with.
Pay minimums on all debts, then channel every extra rupee toward the highest-rate debt. Once eliminated, roll that full payment to the next. Best when rates differ significantly (e.g., 36% credit card vs 10% personal loan).
Ignore interest rates. Pay minimums everywhere, then attack the smallest balance. Each closed account is a concrete win — and the freed-up minimum payment rolls into the next target.
Paying only the minimum on a ₹1,00,000 credit card at 36% APR takes over 11 years and costs ₹2.2 lakh in interest. A fixed ₹5,000/month clears it in 26 months with ₹28,000 in interest.
Credit cards: 18–42% APR. Personal loans: 10–24%. Auto loans: 8–16%. Home loans: 8–10%. Any debt above 15% should be treated as a financial emergency.
Lenders assess you using your DTI ratio: total monthly debt payments ÷ gross monthly income. Below 36% is healthy. Above 50%, borrowing becomes difficult and financial stress intensifies. If your DTI exceeds 40%, aggressive payoff — not new investments — should be your primary financial priority. Clearing 24% debt is a guaranteed 24% return, better than most market instruments.
Juggling 3+ high-rate debts? A consolidation loan can simplify repayment and reduce your blended interest rate. It works best when you can secure a personal loan at a meaningfully lower rate than your current weighted average. The critical discipline: do not use freed-up credit lines to accumulate new debt. Consolidation solves a cash-flow problem — not a spending habit problem.
Before aggressive payoff, maintain a ₹50,000–₹1 lakh buffer. Without it, one unexpected expense pushes you back into 36% credit card debt — erasing months of progress.
Many banks offer 0% interest balance transfers for 6–18 months. Used correctly, this is an arbitrage opportunity — but only if you clear the balance before the promotional rate expires.