!232%4+%5)%,)6),#)(%2+%72#$% Debt Analysis · Debt Analysis – Sneak Peek 2. Welcome Welcome to...

Debt AnalysisPREPARED EXCLUSIVELY FOR

Jane Doe

Unique Document ID:

69caff

Last updated January 2018

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www.cinchmetrics.com | [email protected]

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ContentsWelcome 3

What’s Inside . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

How It Works . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Debt Details 5

Debt A (Corvette) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Debt B (Mortgage) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Debt C (Semester 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Debt D (Semester 2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Debt E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Debt F (Personal Loan) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Debt Summary 12

Payment Summary 13

Savings Analysis 15

Total Lifetime Cost and Total Lifetime Savings . . . . . . . . . . . . . . . . 15

Payoff Time and Time Savings . . . . . . . . . . . . . . . . . . . . . . . . . 17

Preferred Total Payment 19

Cinch Payments 20

Setting Your Payment Values 21

FAQs 22

About Us 24

2Debt Analysis – Sneak Peek


WelcomeWelcome to your Debt Analysis! Congratulations on taking the next step inpaying off your debt, and thank you for choosing Cinch to be your mathematicalpartner.

What’s Inside

In this document, you’ll find a variety of helpful information about your debt, according

to the level of detail you purchased.

Throughout this document, you’ll find text boxes like the one below.

Descriptive Text Box

A descriptive text box is a text box that aims to provide a helpful, intuitivedescription of a term used later in the document.

Please note that these descriptions are not intended to replace the robust technical

definitions used in calculating the values in this document. Readers interested in further

details about the terms or mathematical assumptions used in this document are welcome

to contact us at [email protected] with any questions.

Note: As a reminder, the purchase and/or use of this document is governed by our

Terms and Conditions, found at www.cinchmetrics.com/terms.


http://www.cinchmetrics.com/


http://www.cinchmetrics.com/terms


How It Works

To use this document, follow these four simple steps.

1 Verify the accuracy of your Debt Details, and review your Debt Summaryand Payment Summary.

2 Use your included analyses to find the fixed total monthly payment that bestfits your budget and financial goals – this is your preferred total payment.

3 Look up the optimal way to distribute your preferred total payment amongyour debts – these optimal, fixed payments are your Cinch Payments.

!Note: This document is a free Sneak Peek, and does not include CinchPayments; to obtain your Cinch Payments, please choose a paid offering atwww.cinchmetrics.com.

4 Using your favorite payment method, pay off your debts using these CinchPayments.

Your money is now being distributed optimally. Sit back and enjoy minimum effort with

maximum savings!

Note: This document’s footer contains a progress bar to help you track your progress

through these steps.

4Debt Analysis – Sneak Peek 1 2 3 4



Debt DetailsVerify

Your Debt Details (starting on the next page) organize the information providedabout your debts on 02 Mar 2020. Please verify that this information is accurateas of this date.

As a reminder, each debt in your Debt Details must be both predictable andindependent.• Predictable means that the debt’s remaining principal, interest rate, min-

imum payment, outstanding interest (if applicable), forgiveness time (ifapplicable), and next capitalization time (if applicable) are known in ad-vance.• Independent means that the information above can be accessed for each

debt separately, and that it is possible to direct specific payment valuestoward each debt individually.

If any information in this section is inaccurate, or if any debt in this section failsto satisfy all the assumptions above, please contact us immediately [email protected] and ignore the rest of this document.

Note: Interest rates in this section are rounded to the nearest thousandth for display

purposes only. If you provided interest rates with greater precision, our calculations used

those exact values you provided.




Debt A (Corvette)

Remaining Principal

$10,000.00

Outstanding Interest

$0.00

Outstanding Interest Capitalization

This debt’s outstanding interest does not capitalize.

Minimum Payment

$100.00

Forgiveness Eligibility

This debt is not eligible for forgiveness.

Annual Interest Rate

This debt has a fixed annual interest rate of 2.000% until payoff.



Debt B (Mortgage)

Remaining Principal

$12,000.00


$6,000.00



Minimum Payment

$160.00




The table below summarizes the timeline of this debt’s annual interest rates.

Annual Interest Rate (%) Number of Months Active

7.200 1

2.000 1

1.000 4

1.600 until payoff

Table 1: Annual interest rate timeline for Debt B (Mortgage).



Debt C (Semester 1)

Remaining Principal

$15,000.00


$7,500.00


This debt’s outstanding interest next capitalizes after 30 more payments.

Minimum Payment

$120.00


This debt is eligible for forgiveness after 60 more payments.





Debt D (Semester 2)

Remaining Principal

$20,000.00


$0.00


This debt’s outstanding interest next capitalizes after 40 more payments.

Minimum Payment

$280.00







Debt E

Remaining Principal

$25,000.00


$0.00



Minimum Payment

$260.00







Debt F (Personal Loan)

Remaining Principal

$30,000.00


$0.00



Minimum Payment

$350.00




The table below summarizes the timeline of this debt’s annual interest rates.

Annual Interest Rate (%) Number of Months Active

1.000 1

2.110 until payoff

Table 2: Annual interest rate timeline for Debt F (Personal Loan).



Debt SummaryTable 3 (below) is your Debt Summary. Your Debt Summary provides a conve-nient way to reference some basic information about your debts.

DebtLetter

DebtNickname

RemainingPrincipal ($)

OutstandingInterest ($)

TotalBalance ($)

A Corvette 10,000.00 0.00 10,000.00

B Mortgage 12,000.00 6,000.00 18,000.00

C Semester 1 15,000.00 7,500.00 22,500.00

D Semester 2 20,000.00 0.00 20,000.00

E – 25,000.00 0.00 25,000.00

F Personal Loan 30,000.00 0.00 30,000.00

Total – 112,000.00 13,500.00 125,500.00

Table 3: Summary of debt information provided.



Payment SummaryTable 4 (on the next page) is your Payment Summary. Your Payment Sum-mary organizes all the monthly payment values used throughout this document,including any values entered during the checkout process.

Standard Total Monthly Payment

Your standard total monthly payment is typically the sum of your minimummonthly payments.

In exceptional cases, your standard total monthly payment may be higher than this

sum.

Scale

The scale of a total monthly payment is the ratio

total monthly paymentstandard total monthly payment · 100%.

Your standard total monthly payment has a scale of 100%, and all other total monthly

payments are scaled in reference to your standard total monthly payment.



Monthly Payment ($)Scale (%)

Total Excess

1 1,270.00 0.00 100

2 1,333.50 63.50 105

3 1,397.00 127.00 110

4 1,460.50 190.50 115

5 1,524.00 254.00 120

6 1,587.50 317.50 125

7 1,714.50 444.50 135

8 1,841.50 571.50 145

9 1,968.50 698.50 155

10 2,095.50 825.50 165

11 2,222.50 952.50 175

12 2,540.00 1,270.00 200

13 2,857.50 1,587.50 225

14 3,175.00 1,905.00 250

15 3,492.50 2,222.50 275

16 3,810.00 2,540.00 300

17 4,445.00 3,175.00 350

18 5,080.00 3,810.00 400

19 5,715.00 4,445.00 450

20 6,350.00 5,080.00 500

Table 4: Monthly payment values used throughout this document.



Savings AnalysisYour Savings Analysis compares the total lifetime cost, total lifetime savings,remaining term, and term reduction for each payment from your Payment Sum-mary. These comparisons provide a basic overview of the performance of variousexcess payment values.

Total Lifetime Cost and Total Lifetime Savings

Total Lifetime Cost

Your total lifetime cost is the sum of the lifetime costs of all the debts fromyour Debt Summary, calculated separately for each monthly payment from yourPayment Summary.

Maximum Total Lifetime Cost

Your maximum total lifetime cost is the sum of the lifetime costs of all thedebts from your Debt Summary, applying only minimum payments.

Note: Your maximum total lifetime cost is $124,494.

Total Lifetime Savings

Your total lifetime savings is the difference

(maximum total lifetime cost)− (total lifetime cost),

calculated separately for each monthly payment from your Payment Summary.



Monthly Payment ($) Total LifetimeCost($)

Total LifetimeSavings

($)Total Excess

1 1,270.00 0.00 124,494 0

2 1,333.50 63.50 122,451 2,043

3 1,397.00 127.00 121,268 3,226

4 1,460.50 190.50 120,493 4,001

5 1,524.00 254.00 119,921 4,573

6 1,587.50 317.50 119,439 5,055

7 1,714.50 444.50 118,621 5,873

8 1,841.50 571.50 117,939 6,555

9 1,968.50 698.50 117,361 7,133

10 2,095.50 825.50 116,864 7,630

11 2,222.50 952.50 116,434 8,060

12 2,540.00 1,270.00 115,570 8,924

13 2,857.50 1,587.50 114,921 9,573

14 3,175.00 1,905.00 114,416 10,078

15 3,492.50 2,222.50 114,011 10,483

16 3,810.00 2,540.00 113,679 10,815

17 4,445.00 3,175.00 113,167 11,327

18 5,080.00 3,810.00 112,791 11,703

19 5,715.00 4,445.00 112,505 11,989

20 6,350.00 5,080.00 112,278 12,216

Table 5: Total lifetime cost and total lifetime savings.



Payoff Time and Time Savings

Payoff Time

Your payoff time is the remaining amount of time required to pay off all thedebts from your Debt Summary, calculated separately for each monthly paymentfrom your Payment Summary.

Maximum Payoff Time

Your maximum payoff time is the number of months required to pay off allthe debts from your Debt Summary, applying only minimum payments.

Your maximum payoff time can be found in the first row of Table 6 (on the nextpage).

Time Savings

Your time savings is the difference

(maximum payoff time)− (payoff time),

calculated separately for each monthly payment from your Payment Summary.



Monthly Payment ($) Payoff Time Time Savings

Total Excess (M) (Y) (Y) (M)

1 1,270.00 0.00 121 10.08 0.00 0

2 1,333.50 63.50 121 10.08 0.00 0

3 1,397.00 127.00 121 10.08 0.00 0

4 1,460.50 190.50 121 10.08 0.00 0

5 1,524.00 254.00 115 9.58 0.50 6

6 1,587.50 317.50 108 9.00 1.08 13

7 1,714.50 444.50 99 8.25 1.83 22

8 1,841.50 571.50 90 7.50 2.58 31

9 1,968.50 698.50 84 7.00 3.08 37

10 2,095.50 825.50 79 6.58 3.50 42

11 2,222.50 952.50 73 6.08 4.00 48

12 2,540.00 1,270.00 62 5.17 4.92 59

13 2,857.50 1,587.50 60 5.00 5.08 61

14 3,175.00 1,905.00 60 5.00 5.08 61

15 3,492.50 2,222.50 60 5.00 5.08 61

16 3,810.00 2,540.00 60 5.00 5.08 61

17 4,445.00 3,175.00 60 5.00 5.08 61

18 5,080.00 3,810.00 60 5.00 5.08 61

19 5,715.00 4,445.00 60 5.00 5.08 61

20 6,350.00 5,080.00 60 5.00 5.08 61

Table 6: Payoff time and time savings, in both months (M) and years (Y).



Preferred Total PaymentNow that you’ve reviewed your included analyses, it’s time to decide on thepreferred total payment you’ll use for your repayment.

Custom Financial Metrics

If you’d like to see custom financial metrics for your debts before you decide ona preferred total payment, please contact us at [email protected] formore information.




Cinch PaymentsNow that you’ve decided on a preferred total payment that meets your budget andfinancial goals, it’s time to look up the optimal way to distribute that preferredtotal payment among your debts. These optimal payment values are your CinchPayments.

Sneak Peek

We hope that you’ve found this free Sneak Peek to be a useful tool in un-derstanding your debt repayment. To purchase additional financial metrics –and their corresponding Cinch Payments – please choose a paid offering atwww.cinchmetrics.com.




Setting Your Payment ValuesAs the fourth and final step in using this document, it’s time to set your paymentvalues with your lender(s).

Automatic Payments

If you use automatic payments, simply log in to any website(s) provided by yourloan servicer(s). Navigate to your monthly payments, then set your paymentvalues to match the Cinch Payments you looked up.

Other Payment Methods

Otherwise, using your favorite payment method, simply pay toward each debt theamount indicated by the Cinch Payments you looked up.



FAQsDo you provide advice on how best to choose my monthly budget?

No. Our role is to provide mathematical insight into your debt repayment. For

advice concerning your monthly budget, consult a licensed financial professional.

After receiving this document, how long should I wait before setting my payment

values to my Cinch Payments?

The debt information contained in this document is time-sensitive: the longer you

wait to set your payment values to your Cinch Payments, the less accurately this

document will reflect your actual debt.

How do you calculate interest?

We use the 30/360 rule to calculate interest: each month, for each debt, one-twelfth

of that debt’s annual interest rate is applied to its current balance, followed by the

application of that debt’s fixed monthly payment. This continues until the debt is

paid off.

How do you assume payments are applied?

We assume that payments are applied first to outstanding interest (if applicable),

then to interest generated in the current month, then to remaining principal.

How do you assume forgiveness is applied to a forgiveness-eligible debt?

We assume that, after paying the debt’s minimum payment (or a higher amount) for

the indicated number of payments remaining until forgiveness, the debt’s remaining

principal and outstanding interest are reduced to zero.

Why do my Cinch Payments add up to a smaller amount than the corresponding

total payment?

Under certain circumstances, a decrease in your total monthly payment produces no

increase in your total cost. Our algorithm automatically identifies these cases and

decreases your total monthly payment accordingly, so you waste no cash flow.



What assumptions do you make about the time value of money?

We assume that the value of money is constant with respect to time.

Where should I direct any additional questions?

Additional FAQs can be found at www.cinchmetrics.com; please send any remain-

ing questions to [email protected].





About Us

Cinch specializes in the mathematical analysis of debt repayment,

serving as a mathematical consultant to borrowers and to finan-

cial professionals. For more information, please visit our website at

www.cinchmetrics.com.

Our latest white papers on the topic of debt repayment can always

be found at www.cinchmetrics.com/whitepapers.



http://www.cinchmetrics.com/


http://www.cinchmetrics.com/whitepapers


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