How payoff time is calculated
Each month, interest is added (balance × APR ÷ 12) and your payment is subtracted. The calculator repeats this month by month until the balance reaches zero, then adds up the interest. For a target date, it uses the amortization formula to find the fixed payment that clears the balance on time.
Months ≈ −ln(1 − r × B ÷ P) ÷ ln(1 + r)
B is the balance, P the monthly payment and r the monthly rate. If the payment is not larger than the first month’s interest (r × B), the balance never goes down.
Example: A $6,000 balance at 22% APR with $250 monthly payments takes 32 months to repay and costs about $1,979 in interest. Raising the payment to $350 clears it in 21 months with about $1,269 of interest — a saving of over $700.
Fastest ways to pay off credit card debt
- Stop adding new charges to the card you are paying down.
- Pay a fixed amount rather than the shrinking minimum.
- Ask for a lower APR. Issuers sometimes agree, especially if you have a good payment history.
- Consider a consolidation loan at a lower fixed rate — compare using the loan calculator.
Frequently asked questions
How is credit card interest calculated?
Card issuers divide your APR by 365 to get a daily rate and apply it to your average daily balance. This calculator uses the common monthly approximation (APR ÷ 12 × balance), which gives results very close to your statements when you are not making new purchases.
Why does paying only the minimum take so long?
Minimum payments are usually 1–3% of the balance plus interest, so they shrink as the balance falls. Most of each payment covers interest, and payoff can stretch beyond ten years. A fixed payment above the minimum shortens that dramatically.
Should I use the avalanche or snowball method?
The avalanche method (paying extra on the highest-APR card first) saves the most interest. The snowball method (smallest balance first) gives quicker wins that help some people stay motivated. Either is far better than paying only minimums.
Does a balance transfer help?
A 0% balance transfer can save a lot if you pay off the balance before the promotion ends. Remember the transfer fee (often 3–5%) and the higher rate that applies afterward.