Pay Off Debt, Or Save? Run It Both Ways.
Compound interest works for you and against you, and most people only ever see one side of it. Put the same money in twice — once at the debt, once into savings — and see which route actually leaves you ahead.
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So should I pay off debt or save?
It comes down to the rate on the debt versus the return on the savings — and how certain each one is. Run your own numbers above rather than taking a rule of thumb from anyone, including us.
One thing the calculator does not decide for you: having a small emergency buffer before throwing everything at debt is usually worth it, because without one the next surprise goes straight back on the card. The Money Roadmap covers where that sits.
Why do you call clearing debt a "certain" return?
Because the interest on a debt is contractual. Every pound off the balance is a pound of interest you will definitely not pay, at the rate written in the agreement.
A growth rate is nothing like that. Returns are uneven, can be negative for years, and may be taxed. Putting the two percentages side by side without saying that makes the growth side look better than it is — which is why this page says it plainly.
Is the growth rate a prediction?
No. It is a number you choose so the compounding maths can be illustrated. It is not a forecast, not a rate anyone is offering, and Learn & Grow Rich does not offer an investment product of any kind. If you want to see how sensitive the answer is, run it again at a lower rate — that is a more useful exercise than running it at a higher one.
How do you keep the comparison fair?
Both routes spend the identical amount every month. "Save alongside" pays the minimum on the debt and puts the rest away. "Clear the debt first" throws everything spare at the debt, then redirects the whole amount into savings once it is gone.
The result is compared on net position — savings minus anything still owed. Comparing savings balances alone would flatter the saving route, because it is quietly still carrying the debt.
Does it account for inflation?
Optionally, yes — enter a rate and you also get the figures in today's money. Most compound calculators skip this, which is why a thirty-year projection tends to look more impressive than it deserves to.