Credit Card Payoff Calculator

Monthly rate = APR ÷ 12. A fixed payment clears the balance like a loan; the minimum is recomputed each month as a percentage of the balance, so it shrinks as you pay — stretching payoff.

Why credit cards are different

Two things make credit-card debt behave unlike a loan. First, the APR is high — often 18–30%, far above a mortgage or car loan — so interest piles up fast. Second, the minimum payment is not fixed: it is a percentage of your balance (plus a small floor), so as the balance falls, the minimum falls with it. Pay only the minimum and your payment keeps shrinking, the principal barely moves, and the payoff stretches out for years — sometimes decades — while interest quietly multiplies. This calculator shows that trap plainly, and what a fixed payment does instead.

Choose how you want to pay — a fixed amount each month, a target time to be clear by, or just the minimum — and see the months, the total interest, and how the alternatives compare.

Worked example — $5,000 at 22% APR: Pay a fixed $250 a month and it clears in about two years. Pay only the 3% minimum and the payment shrinks every month — the balance can take well over a decade to clear and cost far more in interest than the $5,000 you borrowed.

The minimum-payment trap

The reason minimum-only payoff is so slow is the shrinking payment. Early on, a 3% minimum on a large balance is sizeable — but most of it goes to interest at a high APR, so the balance barely drops. Next month the minimum is calculated on that slightly-lower balance, so it is a little smaller, and a little more of it is interest. The payment chases the balance downward, and the two converge agonisingly slowly. The calculator’s chart makes it vivid: the minimum-only line crawls across the years while a fixed payment plunges to zero.

The fix is simple and powerful: pay a fixed amount rather than the shrinking minimum. Even holding your current minimum steady — refusing to let it fall — clears the card years sooner and saves a large slice of interest. Paying more than the minimum is the single most effective thing you can do.

Balance transfers, spending and fees

A balance transfer can help if the maths works. Moving the balance to a promotional rate — often 0% for a window of months — stops interest while you attack the principal, but there is usually a transfer fee of 3–5%. Enter the promo rate, fee and window and the calculator nets it out: the interest you save at the promo rate, less the fee, versus staying put. It also reverts to your card’s APR when the promo ends, so a transfer only wins if you clear most of it in time.

Two realities the calculator can fold in: continued spending — new purchases added each month keep the balance up and the payoff away — and an annual fee. Both make the hole deeper, and seeing their effect in numbers is often the nudge to stop adding to the card while you clear it.