What an extra payment actually buys

Advice to pay a little extra is easy to give and hard to size. The engine can size it: hold a portfolio fixed, add a constant amount to the monthly payment, and measure what the payoff date and the interest total do.

Each level is measured against the same portfolio on its minimums alone, so the saving reported is the difference between separate runs of the same engine on the same debts rather than a comparison of averages over different populations.

What the data shows

• An extra $50.00 a month saved a median of 10 mo and $1,642.35; it bought a year or more in 39.7% of portfolios.
• An extra $100.00 a month saved a median of 1 yr 4 mo and $2,634.43, buying a year or more in 75.2%.
• An extra $200.00 a month saved a median of 2 yr 1 mo and $3,870.46, buying a year or more in 98.3%.
• The return is real but not proportional: the median time saved rose from 10 mo to 2 yr 1 mo — a ratio of 2.5 for 4 times the money.

The dataset

Showing 12 of 3000 rows. The complete dataset — every row and every column — is in the CSV.

Download the full dataset (CSV) 3000 rows · 18 columns

The table shows the dataset's own rows, formatted as this site formats money and terms. The download carries the same rows unformatted, which is what a spreadsheet wants.

What was varied

Portfolios drawn

3,000

Debts per portfolio

2 to 5, drawn uniformly

Balance per debt

$300.00 to $25,000.00, drawn log-uniform

Rate per debt

no interest (0%), weight 1 · instalment-rate (4.5% to 11.99%), weight 2 · lower-rate card (12.99% to 18.99%), weight 3 · ordinary card (19.99% to 25.99%), weight 4 · high-rate card (26% to 29.99%), weight 2 — weights are relative, and are a modelling choice rather than a measurement of the market

Generator

mulberry32, seeded once per study and drawn in a fixed order: debt count, then for each debt its balance, its rate band, and — only when that band spans a range — its rate within it, then the extra-payment share. ⛔ The no-interest band is a single value, so it consumes no draw; a reader who always draws a rate will diverge from this corpus. Inserting or removing a draw anywhere changes every portfolio after it, which is why the order is part of the method and not an implementation detail.

Extra each month

0% to 0% of the portfolio's total minimums

Extra payment levels

$50.00 · $100.00 · $200.00 a month, each against the same baseline

Seed

20,260,918

What was held constant

Minimum payment (held constant)

Every debt's minimum is this month's interest plus 1% of the balance, with a $25.00 floor — a shape that always covers the interest, so every baseline is a real term rather than an absence and the saving measured is the extra payment's. It is computed on the opening balance and held there for the term, which is the engine's model of a minimum payment. A flat percentage-of-balance minimum stops covering the month's interest above a certain rate — which is the subject of the minimum-payment study on this site, not a claim this study measures.

Behaviour

Every payment lands on time, no new balance is added, no rate moves, no fee is charged and no promotional rate expires.

Payoff order

Avalanche — the dearest rate first — held constant, so the saving measured is the extra payment's and not the order's.

Plan anchor

January 2026 — pinned, so a rerun on any day produces identical output. These studies report terms and interest, never dates, so the anchor changes no published figure.

Data

Synthetic throughout. No customer data was used, approximated or fitted, and nothing here is a claim about what borrowers actually owe.

Engine version

payoff-25e86113b543

What was excluded, and how much

• 0 excluded — the minimums alone do not clear the balance, so there is no baseline term to save months from.

How this was computed

Each portfolio was run through the payoff engine on its minimums alone to establish a baseline, then again at each extra level, with everything else held constant. The saving is the difference between the baseline and the level, portfolio by portfolio — never a comparison of averages taken over different populations.

Every portfolio in the corpus amortizes on its minimums alone, so every baseline is a real term rather than an absence.

What the model assumes

The extra payment is paid every month without interruption, in addition to every minimum, and it cascades to the dearest rate. The debts do not grow, the rates hold, and no fee is charged.

In practice an extra payment above the minimum must be applied to the highest-rate balance on a card under federal allocation rules, which is what the engine models; the minimum itself is allocated at the issuer's discretion.

What this does not show

It does not show that any given household can find the money, and it does not weigh an extra payment against an emergency fund, a retirement match, or a debt in collections. Those are decisions the arithmetic cannot make.

The medians here describe the corpus. A portfolio dominated by a single large high-rate balance responds differently from a spread of small balances, and the dataset carries both.

Synthetic data, and why

No customer data was used, approximated or fitted here. The portfolios are drawn from a published distribution with a published seed, so the entire study can be regenerated from this repository and checked against what is written here.

Sources

1. Consumer Financial Protection Bureau — Regulation Z, 12 CFR §1026.53 — Allocation of payments (tier 1)

Our source and corrections policy explains how these are chosen.

Related

• Extra payment calculator
• What the snowball order actually costs
• Debt payoff calculator
• Methodology