Some debts come with a deadline: a holiday that has to be paid off before you travel, a 0% offer with deferred interest, a buy now, pay later plan or a tax bill. Undebt.it+ members can give any debt a pay-off date, and the plan makes sure it's paid off by then.
Setting a pay-off date
- Open the debt from your Account List.
- On its Debt Details page, open the Settings tab.
- Under Pay Off By a Date, choose the month and year, then click Save Date.
The date means paid off by the end of that month. To put the debt back in its usual place in your payoff order, click Remove Date.
What your plan does with the date
Your plan works out the steady monthly payment that clears the debt by the end of that month, interest included, and pays it at least that much every month until it's gone. For a 0% debt that is the balance divided by the months left: $2,400 due in eight months is $300 a month.
- The extra comes out of your snowball, the money you pay beyond your minimum payments, so your total monthly payment stays the same.
- Whatever is left of your snowball keeps following your payoff order and goes to your other debts.
- The amount is worked out again every month. Pay extra toward the debt and it goes down; fall behind and it goes up.
- The debt is paid every month until its date, even if its next due date is later. Keep the next due date on your next real payment, not on the final date.
The debt's page shows how much your plan sets aside for it and the month it's projected to be paid off. It also shows what the date costs: paying a 0% balance early leaves less for your higher-interest debts, so the page tells you how much more interest the date adds compared with your plan without it.
If your budget can't make the date
Your plan still puts as much as it can toward the debt, and Undebt.it tells you in three places:
- The debt's page shows what the date needs each month, what your budget can put toward it, the difference, the balance that will be left at the date and when the debt will be paid off.
- A red exclamation mark appears next to the debt's name on the Payment Plan page. Hover over it for the details.
- A warning on your dashboard lists every pay-off date your budget won't make.
To make the date, raise your total monthly payment or choose a later date. If a date passes before the debt is paid off, the plan keeps it first in line until it is.
Deferred-interest offers
With a deferred-interest offer, a balance left when the promotion ends can be charged all the interest from the start, so it pays to finish a month early. When a debt is marked as a deferred-interest account and has a promotional end date, the date picker fills in the month before the promotion ends for you. How do I handle promo interest rates? covers the promotional rate settings.
Without Undebt.it+
Pay Off By a Date is part of Undebt.it+. On a free account you can get close by hand: set the debt's minimum payment to its balance divided by the months you have left, or, for a promotional balance, turn on This is a deferred-interest account to move it to the top of your payoff order.