Consolidation Loan Investment Calculator

Getting a consolidation loan can do more than payoff your debt. You can create a sizeable nest egg by investing all or a portion of your monthly payment savings. After a few years the results may surprise you!

Use this calculator to see the results of paying off your debt and investing your payment savings.

Auto loans
Click on the "Details" button to enter any auto loans you may have. The details page is designed to let you enter your current monthly payment, the term (in months), the starting balance and the number of months you have left. It then calculates your outstanding balance and interest rate. You can enter up to three installment loans.

Other loans
Click on the "Details" button to enter any additional installment loans you may have in the details page. This page is designed to let you enter your current monthly payment, the term (in months), the starting balance and the number of months you have left. It then calculates your outstanding balance and interest rate. You can enter up to six installment loans.

Balances
Your total current balances for your credit cards, auto loans and other loans.

Interest rates
The average annual percentage rate you pay. This interest rate is calculated for each of the categories of debt you have including credit cards, auto loans and other installment loans. For credit cards, the rate you enter is used to calculate the interest on all future credit card payments. The length of time to pay off this credit card may be much greater than calculated if you enter a low promotional interest rate that is only good for a short period of time.

Payment
This is your initial monthly payment. For credit cards, if you checked the "use credit card minimum payments" box on the details page, your monthly payment is calculated as 2% of your current outstanding balance. With the "use credit card minimum payments" box checked, your monthly payment will decrease as your balance is paid down. This can greatly increase the length of time it takes to pay off your credit cards. Uncheck this box to enter your own monthly payment that will remain the same until your balance is paid in full.

(We calculate your minimum monthly payment as 2% of your current outstanding balance. While your actual minimum monthly payment may be slightly different, this is one of the most common methods used by credit card companies to calculate minimum payments.)

Loan balance
This is the total loan amount you are planning on receiving. This amount must be at least equal to your total outstanding debt plus any fees. If you choose to receive a larger loan amount than your outstanding debt, plus any fees, the additional amount is added to the starting balance of your investment.

Loan term
The length of time you will repay this loan. The investment timeframe for this calculator also uses the loan term. This can be from one to 30 years.

Loan interest rate
The annual interest rate you are charged for this loan. The checkbox indicating that this is a Mortgage is checked, payments will be monthly and interest will be compounded semi-annually. Otherwise, this calculator assumes that your payments are made monthly and that interest is compounded monthly.

Percent to invest
This is the percentage of your monthly payment savings you wish to invest. Any remaining payment savings is used to repay your loan. For example, if you have a monthly payment savings of $100 and choose to invest 75%, $75 would be invested and $25 would be an additional amount applied to your loan balance.

Rate of return
The annual percentage rate you expect to earn on your investment savings. The average annual rate of return for the TSX has been 11% for the last 20 years. This calculator compounds all growth annually. For the purposes of this calculator, taxation is not factored into the results. If you pay taxes on the interest, dividends or capital gains from these investments you may wish to enter your after tax rate of return.