Your Card Details
Your Payoff Plan
| # | Payment ($) | Interest ($) | Principal ($) | Balance ($) |
|---|
Fixed Payment vs Minimum Payment (2.5%, $25 floor)
How It Works
Monthly interest = balance × (APR ÷ 12). Each month, interest is added to your balance first, then your payment is subtracted — whatever remains reduces principal.
Fixed payment mode simulates month by month until the balance reaches zero, returning your exact debt-free date and total interest.
Target month mode solves for the payment needed: PMT = B × r ÷ [1 − (1+r)−n], where B = balance, r = monthly rate, n = months.
Minimum payment comparison simulates paying 2.5% of the balance (min $25) each month — the structure used by most card issuers.
Actual card issuers may use daily periodic rates, different minimum payment formulas, or add fees. Results here are close estimates for planning, not exact billing figures.
Frequently Asked Questions
How is credit card interest calculated?
Most cards use a daily periodic rate (APR ÷ 365) applied to your balance each day. Dividing APR by 12 for a monthly rate gives a very close planning estimate. Because interest compounds, minimum payments can keep you in debt for decades.
How long does it take with minimum payments?
Decades. A $5,000 balance at 22% APR paid at a 2% minimum takes roughly 25+ years and costs more in interest than the original balance. The comparison table above shows the exact difference on your own balance.
What payment gets me debt-free in 12 months?
Switch to "Pay Off in Target Months", enter 12, and the calculator returns the exact fixed payment required plus total interest for that year.
What if my payment is less than the monthly interest?
Your balance grows every month — negative amortization. The calculator warns you when a payment can never pay off the debt, so you can raise the payment or seek a lower-rate option like a balance transfer.