Cake Budget’s Debt Payoff feature turns a pile of credit cards and loans into one clear plan: a payoff order, a projected debt-free date, and an extra payment that moves itself on payday. You never have to build a spreadsheet, calculate interest, or decide which debt “deserves” your money this month — the plan does the math, you follow it.

What You’ll Accomplish

By the end of this guide you’ll have every debt in one payoff plan, a projected debt-free date on screen, and (optionally) your extra payment automated so it’s set aside every payday before it can be spent.

Prerequisites

✅ A Cake Budget account
✅ Your debt balances handy — or a connected bank with your credit cards (see How to Connect Your Bank Account)
✅ Optional: a funding schedule for automation (see How to Setup a Funding Schedule)

Step 1: Add Your Debts

Click “Debt Payoff” in the main navigation, then “Add a debt”. Each debt is a slice (see Envelope Budgeting Explained) with a few extra fields:

Link a credit card (recommended)

If your credit card is connected through your bank, select it under “Link a credit card”. The amount you owe then syncs from your bank automatically — you never type or update it, and when the card hits zero, Cake notices and celebrates on its own.

Or track the balance yourself

For loans and cards at banks you haven’t connected, enter the amount you currently owe. You can update it any time with one tap, and Cake will check in about once a month to make sure the number is still right.

The optional fields (skip anything you don’t know)

Field	What it’s for	If you skip it
APR %	Interest projections	We assume 0% — add it anytime for a sharper date
Minimum payment	Payoff timeline math	We assume a typical minimum and tell you we did
Payment due day	A calm reminder email a few days before each due date	No reminders for this debt

Important: the “Payment budget per cycle” and “Set aside for payments so far” fields are your envelope — money you’re reserving to make payments. They’re separate from the amount you owe. More on this in Debt Payoff Explained.

Step 2: Meet Your Plan

As soon as one debt has a balance, the Debt Payoff page shows your plan:

Your projected debt-free date — the headline. It recalculates instantly whenever anything changes.
Your payoff order — every debt gets a number. #1 is your focus debt, marked “Up next”: it’s where every extra dollar goes until it’s gone.
Per-debt progress bars — each debt shows the percent you’ve already paid off, and its own projected payoff month. You don’t wait years for one big finish line; you get a series of finish lines.

Step 3: Pick Your Strategy (or Keep the Default)

Cake starts you on Snowball — smallest balance first. Toggling to Avalanche — highest interest rate first — instantly re-orders the plan and shows you the tradeoff in dollars and months.

	Snowball	Avalanche
Order	Smallest balance first	Highest APR first
Strength	Quick wins — your first debt disappears fast, and that momentum is what keeps people going	Lowest total interest
Best for	Most people (it’s why we default to it)	Rate-focused optimizers

Both get you debt-free. Pick the one you’ll stick with — the plan shows you exactly what each choice costs and saves, so it’s an informed pick, not a guess.

Step 4: Set Your Extra Payment

Drag the extra payment slider. This is money on top of your minimum payments, aimed entirely at your focus debt — and it’s the single biggest lever on your debt-free date, which updates live as you drag. Changes save automatically; there’s no save button to forget.

Prefer to think per paycheck instead of per month? Once a paycheck schedule is selected, switch the amount between per month and per paycheck.

Step 5: Automate It (the Best Part)

Under the slider, choose a paycheck schedule under “Set it aside automatically.” From then on:

On payday, your extra payment moves into the focus debt’s envelope — before it can be accidentally spent
You pay your card or loan like you always do
When a debt hits zero, the extra payment automatically rolls to the next debt in your order — no action needed from you

Paid semi-monthly or biweekly? Choose whether the extra is split across every paycheck or comes entirely from your first or second paycheck of the month — whichever matches how your money actually flows.

Pro Tip: Minimum payments aren’t automated by the plan — the plan counts them, but you fund them like any other slice. Many people link each debt slice to their funding schedule for the minimum, and let the plan manage only the extra. The plan will never touch a contribution you set up yourself.

Step 6: Let the Plan Work

From here, Cake keeps things moving:

Payment reminders: if you set a due day, you’ll get a calm heads-up a few days before — including how much you already have set aside (“that covers the minimum, you’re ready”)
Balance check-ins: for manually tracked debts, about once a month Cake asks “Still about $X?” — one tap to confirm, or a quick update
Celebrations: when a debt is paid off, you get confetti, a congratulations email, and a permanent spot in your “Paid off” list. Cleared debts stay visible — they’re your proof this works.
Ask Cake: the AI assistant can answer “When am I debt-free?” or “Which debt should I pay first?” straight from your plan (see AI-Powered Financial Insights)

Troubleshooting

A debt shows “Finish setting up” — it has no balance yet. Tap “Add balance” and it joins the plan immediately.

Your debt-free date says “Not yet projected” — one of your debts has a minimum payment that doesn’t cover its monthly interest, so on its own it would never shrink (its card explains this and it won’t show a payoff date). Add even a small extra payment and real dates appear — and often, once earlier debts clear, the rollover reaches it and gives it a date anyway.

The plan says a schedule “already has its own contribution” — you previously linked that paycheck to this debt slice yourself. Edit that contribution on the Funding Schedules page, or pick a different schedule for the extra payment. Cake never overwrites automation you built by hand.

Debt Payoff Explained — how the plan thinks, and why snowball is the default
How to Setup a Funding Schedule
Understanding Safe-to-Spend