Debt Consolidation Calculator
Compare snowball, avalanche, and consolidation strategies for multiple debts.
Last reviewed: Source: NCR — Debt management
What debt consolidation actually is
Debt consolidation bundles multiple small debts (credit cards, store cards, overdrafts, personal loans) into one larger loan at — ideally — a lower average interest rate. You end up with one monthly instalment instead of five, the instalment is usually smaller than the sum of the originals, and you pay off the total faster if you stay disciplined.
The keyword is “ideally.” Done right, consolidation can save R50,000+ in interest over a few years. Done wrong — extended term + same spending habits — it buries you deeper than you started.
When consolidation saves you money
Three conditions have to line up for consolidation to be a mathematical win:
- New rate is lower than the weighted average of what you currently pay. Consolidating 22% credit-card debt into a 19% personal loan: yes. Consolidating a 14% car loan into a 20% personal loan: emphatically no.
- New term is not significantly longer than the weighted-average of existing terms. If you have 24 months left on a R50k car loan and consolidate into a 60-month personal loan, your monthly is lower but the total interest is higher.
- You close the accounts you consolidated. The single biggest predictor of consolidation failure: keeping the credit cards open and running up new balances within 12 months. Close them or freeze them at zero.
The consolidation options in SA, ranked
| Option | Typical rate | Term | Best for |
|---|---|---|---|
| Access bond top-up | Prime to prime + 2% (≈12–14%) | Remaining bond term | Homeowners with LTV headroom — cheapest option. |
| Personal loan (bank) | 18–22% | 12–72 months | Non-homeowners with clean credit. Middle option. |
| Personal loan (brokered) | 20–24% | 12–60 months | Usually includes broker fees. Check total cost carefully. |
| Debt counselling | Rates vary — court-mediated | Court order | Use only if you’re already in default or facing legal action. |
| Balance transfer card | 0% intro → standard rate | 6–18 months intro | Rare in SA; mostly product-specific offers. |
Access bond wins on math. Using it to pay off 22% credit-card debt while you’re only paying 12–14% on the bond is a 8–10% annualised saving on the consolidated amount. Zero extra paperwork (the facility already exists on your bond), instant access, no application fees.
Worked example
R120,000 of mixed debt consolidated into a personal loan
Credit card R40k @ 22% (R2,000/mo), store card R15k @ 24% (R900/mo), personal loan R30k @ 19% (R1,100/mo for 36 mo remaining), overdraft R35k @ 20% (R1,800/mo interest-only). Total R120k, R5,800/mo combined, blended rate ~21.2%.
- Current total debt
- R120,000
- Current blended rate
- ≈ 21.2%
- Current monthly outflow
- R5,800
- Consolidate into 48-month personal loan @ 19%
- —
- New monthly instalment
- ≈ R3,608
- Monthly cashflow saving
- R2,192
- Total paid over 48 months
- ≈ R173,184
- Total interest over consolidated term
- ≈ R53,184
Same debt — but paid via access bond top-up
Homeowner with a R1.5m bond at 12% (prime + 0.25). Takes a R120k access draw to pay off the lot. Continues paying the same R5,800/month toward the bond.
- Access draw
- R120,000
- Effective rate
- 12%
- Extra to bond monthly
- R5,800 (what you were paying anyway)
- Time to repay R120k extra capital
- ≈ 25 months
- Interest on the draw
- ≈ R14,800
- Versus personal loan option (R53,184 interest)
- ≈ R38,400 cheaper
When consolidation is the wrong answer
- You haven’t fixed the underlying spending. If you consolidated R80k of cards because you were living R5k/month over your income, you’ll be back to R80k in debt within 18 months — now with both the consolidation loan AND new card balances. Fix spending first.
- The new loan has an exit penalty. Some brokered consolidation loans charge early-settlement fees. If you plan to pay off aggressively, this eats the saving.
- You’re extending a short debt into a long one. Consolidating a 18-month personal loan into a 60-month consolidation loan at a slightly lower rate often costs more in total interest despite the lower monthly instalment.
- The broker charges 5–10% as a once-off fee. Walk away. Legitimate consolidation is available direct from your bank at no fee.
Debt counselling — a different thing
Debt counselling (also called debt review) under NCA s86 is legal protection for people already in default or about to be. A registered debt counsellor proposes a restructured payment plan to all your creditors, goes to magistrate’s court for approval, and you pay one monthly amount (usually to a Payment Distribution Agency) that gets split across creditors.
Under debt review:
- Creditors can’t repossess or take legal action while the plan is current.
- You can’t take on new credit until you exit debt review.
- Exit requires either full payment of the restructured debt OR a court order removing you (e.g. if you can now afford original instalments).
- The debt review flag stays on your credit record for a period after exit.
Debt counselling is not consolidation — it’s a court-mediated restructuring. Use it if you’re already in default; avoid it if you can solve the problem privately via consolidation.
Red flags when shopping
- Upfront fee. NCR-registered consolidators charge fees from the loan proceeds, not up front. Anyone asking for cash to “set up” the loan is a scam.
- Guarantee of approval. Legitimate lenders do NCA affordability checks. “Guaranteed approval regardless of credit history” is always a scam.
- Rate above the NCA cap. Unsecured credit is capped at repo + 17% (≈24.75% in 2026). Anything higher is illegal.
- No NCR registration number. All legitimate SA credit providers have an NCR registration number displayed. Check it at ncr.org.za before signing anything.
- Pressure to sign today. Take the quote, go home, compare.
How this calculator works
Enter each of your existing debts (balance, rate, monthly payment) and the proposed consolidation terms (new amount, new rate, new term). The calculator computes your current blended rate, your new monthly instalment under consolidation, the total interest saved (or lost), and the payoff acceleration if you continue paying the pre-consolidation monthly amount into the new loan.
Sources
Frequently Asked Questions
Pay minimums on all debts, then allocate all extra money to the highest-interest debt first. This saves the most money in total interest but may take longer to eliminate the first debt.
Pay minimums on all debts, then allocate extra to the smallest balance first. This gives psychological wins faster but costs slightly more in total interest than the avalanche.
When you can get a consolidation loan at a significantly lower rate than your existing debts, AND you commit to not accumulating new debt. Beware: longer terms increase total interest even at lower rates.
Taking out one larger loan to pay off multiple smaller debts. Benefits: simpler payment, potentially lower rate. Downside: longer repayment terms may increase total interest cost.