Credit Card Interest Calculator
Enter your balance, APR and monthly payment to see your payoff date and total interest — then nudge the payment up and watch the interest collapse.
How credit card interest actually works
Credit cards charge interest daily on your average balance: your APR divided by 365, applied every day, then billed monthly. At 20.99% APR, a $5,000 balance accrues roughly $87 of interest in the first month — so of a $200 payment, only about $113 reduces what you owe. That's why minimum payments feel like running on a treadmill.
The minimum payment trap
Minimum payments are typically 2–3% of the balance or interest plus a small fixed amount. Paying only the minimum on $5,000 at 21% APR can take well over 20 years and cost more in interest than the original balance. Fixing your payment at a set dollar amount (rather than the shrinking minimum) already cuts years off; raising it beats almost any other use of spare cash, because paying down 21% debt is a guaranteed 21% return.
Faster payoff strategies
- Avalanche: pay minimums on everything, throw every spare dollar at the highest-APR card. Mathematically optimal.
- Snowball: smallest balance first, for the motivational wins. Slightly costlier, often more sustainable.
- Balance transfer / consolidation: a 0% promotional transfer or a lower-APR personal loan can save a lot — check the transfer fee and use our loan calculator to compare.
What the payment amount actually does
A $6,000 balance at 22.99% APR. The only variable is what you pay each month:
| Monthly payment | Time to clear | Total interest |
|---|---|---|
| $150 | 6 years 5 months | $5,492.01 |
| $200 | 3 years 10 months | $3,011.78 |
| $300 | 2 years 2 months | $1,638.69 |
| $400 | 1 year 6 months | $1,141.70 |
Look at the top row: at $150 a month you pay $5,492 in interest — very nearly the value of the original balance — and you're still paying in 2032. Doubling to $300 cuts the interest by $3,853 and clears the debt four years sooner. Very few financial decisions available to an ordinary household have that kind of return.
Why paying down 23% debt beats investing
Clearing a balance at 22.99% APR is mathematically identical to earning a guaranteed, tax-free 22.99% return. No investment offers that with certainty. Unless you're forgoing an employer pension match — free money you should always take first — high-interest card debt is almost always the highest-return use of a spare dollar.
Order of attack when you have several cards
- Always pay every minimum first. A missed payment triggers fees and can push you onto a penalty APR near 30%.
- Avalanche: every spare dollar to the highest APR. Mathematically optimal — the least total interest.
- Snowball: smallest balance first. Costs slightly more but delivers visible wins, which is why people actually finish.
- Balance transfer: a 0% promotional period can help enormously — but check the transfer fee (typically 1–3%) and be certain you'll clear it before the promotional rate expires.
The best strategy is the one you'll stick with. If avalanche feels like grinding with nothing to show, snowball's momentum is worth the modest extra cost.