How It Works

Imagine you get some extra money, like a birthday gift or a prize! What do you do with it? Our Windfall Calculator helps you use that money to pay off debts—like money you owe for toys or games—so you don’t have to pay extra fees called "interest." It’s like a fun game where you save money by being smart! Here’s how it works, step by step.

What’s a Windfall?

A windfall is extra money you didn’t expect. It could be:

  • A present from Grandma.
  • Money from a job bonus.
  • Cash from selling old stuff.

Our tool shows you how to use this money to make your debts go away faster.

Step 1: Tell Us About Your Debts

First, you tell the calculator about your debts. You say:

  • How much you owe (like $100 for a bike).
  • The interest rate (a fee for borrowing, like 5%).
  • How much you pay each month (like $10).
  • How long you were supposed to pay (like 12 months).

It’s like giving the tool a list of your chores—it needs to know what you’re working with!

Step 2: Pick a Plan

Next, you choose how to tackle your debts. There are two fun ways:

  • Avalanche: Pay the debt with the biggest interest first. It’s like climbing the tallest hill to save the most money!
  • Snowball: Pay the smallest debt first. It’s like rolling a tiny snowball that gets bigger and bigger as you finish more debts.

The calculator picks the best debts to pay with your windfall based on your plan.

Step 3: The Calculator Does Its Magic

Here’s where the fun happens! The calculator:

  • Looks at your extra money (the windfall).
  • Decides which debts to pay off first (ones with high interest, usually over 4%).
  • Pretends to pay them month by month for 5 years (60 months).
  • Shows how much interest you save—like finding coins you didn’t know you had!

If you pay off a debt early, the money you used to pay it helps with other debts. If all debts are gone, it shows how much you can save with interest, like putting money in a piggy bank that grows.

Step 4: See Your Results

The calculator makes a table that shows:

  • Your extra money at the start.
  • Which debts get paid (and how much you save).
  • What’s left of your windfall.
  • Debts you didn’t pay yet.

You can even try your own ideas! Pick which debts to pay, and the calculator shows what happens. It’s like playing a money-saving game!

Why It’s Cool

  • Saves Money: You pay less interest, so you keep more for fun stuff.
  • Easy Peasy: It does the hard math for you.
  • Try It Out: You can test different plans to see what works best.

A Little Example

Let’s say you have $500 extra and two debts:

  • Debt 1: $300, 5% interest, $20 a month.
  • Debt 2: $200, 3% interest, $15 a month.

The calculator might use all $500 to pay Debt 1 ($300) and part of Debt 2 ($200). It tells you how much interest you save and what’s left to pay. Super simple!

Remember: This tool is just for fun and learning. It’s not real financial advice. Talk to a grown-up or money expert before deciding what to do with your money. We’re not responsible if something goes wrong!