Pay in full vs payment plan calculator

When a practice offers a discount for paying in full, it can be hard to tell whether that beats spreading the cost over a payment plan. This calculator compares the real cost of each.

How it works

Enter the full price, the pay-in-full discount, how long the payment plan runs, the plan's interest rate, and what your savings account earns.

• Pay in full costs the price minus the discount, paid today.
• Payment plan costs a fixed monthly payment for the length of the plan.

To compare them fairly, the calculator converts the plan payments into today's dollars. A payment due in 12 months costs you a little less than the same amount today, because the money can earn interest until then. If the plan charges interest, the payments go up, and paying in full looks better.

The result shows which option costs less in today's dollars and by how much.

Example

A treatment costs $4,000. The office offers 5% off for paying in full, or a 12-month plan at 0%.

• Pay in full: $3,800 today.
• Plan: 12 payments of about $333, totaling $4,000.

Even if your savings earn 3.5%, the plan costs about $3,925 in today's dollars, so paying in full saves about $125. Without the discount, the 0% plan would win.

Think about cash flow

The lowest cost isn't the only thing that matters. If paying in full would leave you short on cash for rent or other bills, a plan may still be the better choice for you. Keep at least a small emergency cushion either way, and only pay in full with money you won't need in the next few months.