PowerPay Debt Reduction Computer Program

Developed by F. Dean Miner, Jr., and Judy L. Harris
Utah State University Extension

How Does the Program Work?

The PowerPay computer program is an easy-to-use educational tool that allows financial advisors to quickly show consumers the impact of power payments on individualized consumer debt situations.

Initially PowerPay calculates what the repayment time and interest costs will be if the consumer continues making payments at current levels. It is shocking for most consumers to see the interest costs and the length of time it takes to repay debts, especially if they are making only the minimum required payment.

The PowerPay calculates the possible savings of rolling over partial or full power payments to creditors according to three scenarios: paying off creditors with highest interest rate first, paying off creditors with lowest balance first, or paying off creditors with shortest term first.

Explore the Possibilities

In just a few minutes a consumer can compare several ways of trimming credit costs.

  • Look at savings in interest costs and months to repay or any customized sequence
  • Easily compare debt pay-off sequences for maximum emotional boost from early debt repayment
  • See impact of adding a little extra to the total monthly payments
  • Calculate savings from making a one-time lump sum payment at a specified future date
  • Explore possible savings from consolidating some or all the debts
  • Learn the pitfall of making declining minimum payments by comparing costs to those from making fixed payments

All evaluations can be printed or saved to disk files

Additional Features

  • User friendly pop-up menus
  • A debt reduction calendar outlining month by month how much to pay each creditor
  • Amortization schedule on any creditor can be printed or viewed on screen.

What Are Power Payments?

Learning how to make power payments is one method suggested by financial experts to systematically put you on the path to being debt free. This is how power payments work:

  • First make a commitment to stop borrowing or charging until current debts are paid.
  • The principle of power payments is that as soon as one debt is paid off, you apply the monthly payment from that debt to the next debt. By the time you have paid off a few creditors, you are paying large monthly payments to the remaining debts. The PowerPay computer program will help you decide how to distribute these payments.
  • The total monthly payment is not increased, only the distribution of payments changes.

The bottom line is...hundreds of dollars can be saved on interest in addition to paying off debts months or years earlier.

A Windows version of PowerPay is now available. For more information about how Power Pay works, contact Judy Harris or Dean Miner at 801-370-8460. Direct questions about ordering PowerPay to the Extension Bulletin Room at 435-797-2251.

Current costs are: $20 for one PowerPay package or a $200 site fee which permits you to make up to 100 copies of the disk. Make checks, money orders, or purchase orders payable to USU Extension Service. Send to:

Extension Bulletin Room
8960 Old Main Hill
Logan, UT 84322-8960

PowerPay is now available free, online.
Go to http://extension.usu.edu/htm/finance and click on PowerPay.