How to use the Credit Card Payoff Calculator
- Enter your current card balance.
- Enter the APR from your statement. It is the yearly interest rate.
- Enter the amount you plan to pay every month.
- Read the time to pay off and the total interest, then try a larger payment to see the difference.
Formula used
Each month: interest = balance × (APR ÷ 12), then the balance falls by payment − interest. The loop repeats until the balance reaches zero. The payment must be larger than the monthly interest.
Worked example
Here is the Credit Card Payoff Calculator worked through with the example values shown above, so you can check each step by hand.
| Inputs | |
|---|---|
| Card balance | $5,000 |
| APR (interest per year) | 22 % |
| Monthly payment | $200 |
| Result | |
| Time to pay off | 2 years, 10 months |
| Total interest paid | $1,750 |
| Total paid | $6,750 |
Effect of paying more each month
The default balance and APR with different monthly payments.
| Monthly payment | Time to pay off | Total interest paid |
|---|---|---|
| $150 | 4 years, 4 months | $2,798 |
| $200 | 2 years, 10 months | $1,750 |
| $300 | 1 year, 9 months | $1,022 |
| $500 | 1 year, 0 months | $574 |
| $1,000 | 6 months | $294 |
How the payoff is worked out
Each month the card charges interest on the balance, equal to the APR divided by 12 times the balance, and then your payment is subtracted. With a $5,000 balance at 22% APR, the first month’s interest is $91.67. A $200 payment therefore reduces the balance by only $108.33 at first. Over time, as the balance falls, less of each payment goes to interest and more to the balance.
The calculator repeats this month by month until the balance reaches zero. At $200 a month the debt takes 2 years, 10 months to clear and the interest comes to $1,750, so you repay $6,750 in total for a $5,000 balance.
Paying more each month
Raising the payment has a larger effect than it seems. At $300 a month the same balance is cleared in 1 year, 9 months with $1,022 interest. At $500 a month it takes 1 year, 0 months and costs $574 in interest. Compare that with $150 a month, which takes 4 years, 4 months and costs $2,798.
Because interest is charged on the unpaid balance, every extra dollar early on saves more than a dollar later. If you can, pay more than the minimum and add any extra cash such as a bonus or tax refund.
The danger of minimum payments
Card issuers set the minimum payment low, often a small percentage of the balance plus interest. It keeps the account in good standing but stretches repayment over many years. If your payment barely covers the monthly interest, the balance hardly moves. The calculator warns you when the payment is not large enough to reduce the balance at all.
If you are in that position, look for ways to raise the payment, even temporarily, and stop adding new purchases to the card while you repay it.
Ways to pay off debt faster
Two common strategies are the avalanche method, where you put extra money towards the card with the highest APR first, and the snowball method, where you clear the smallest balance first for motivation. The avalanche method saves the most interest; the snowball method can be easier to stick with.
Balance transfer cards with a low introductory rate and personal loans at a lower rate can also reduce interest, but they may charge fees, so compare the total cost before you switch. This calculator does not include fees or new purchases.
Frequently asked questions
How long will it take to pay off my credit card?
Enter your balance, APR and monthly payment. The calculator simulates each month until the balance reaches zero and shows the time in years and months.
Why is my payoff time so long?
Credit card interest is high, so a small payment barely reduces the balance. A larger payment shortens the time sharply.
Does this assume no new purchases?
Yes. Any new spending on the card adds to the balance and delays payoff.
Where do I find my APR?
On your monthly statement or in your online account. If you have different rates for purchases and cash advances, use the rate that applies to your balance.
What if the payment is lower than the interest?
Then the balance never falls. The calculator tells you to increase the payment.
Is the interest calculation exact?
It is a close estimate using monthly interest. Real cards often charge interest daily, so your statement may differ slightly.
This calculator gives estimates for information only. Actual figures from a bank, employer, tax authority or doctor may differ. It is not financial, tax, legal or medical advice.