Credit Card Payoff Calculator
Calculate how long it will take to eliminate your credit card debt.
$
%
$
Must be greater than the interest accrued.
Months to Payoff
32 Months
Total Principal
$5,000.00
Total Interest Paid
$1,385.12
The Danger of Minimum Payments
Credit card companies want you to make minimum payments because that is how they maximize their profits. Our Credit Card Payoff Calculator shows you the true cost of carrying a balance.
By increasing your monthly payment by just a small amount, you can dramatically reduce the time it takes to become debt-free.
Payoff Strategies
| Strategy | How it Works | Best For |
|---|---|---|
| Avalanche Method | Pay off cards with the highest APR first. | Saving the most money on interest. |
| Snowball Method | Pay off cards with the lowest balance first. | Building psychological momentum. |
| Debt Consolidation | Take out a personal loan to pay off all cards. | Simplifying payments and lowering APR. |
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Frequently Asked Questions
How does credit card interest work?
Credit card interest is typically calculated on a daily basis based on your Average Daily Balance. If you carry a balance month-to-month, interest compounds, meaning you pay interest on your interest, making it very expensive.
Why is making only the minimum payment bad?
Minimum payments are often calculated as a small percentage of your total balance (e.g., 2%). Most of this goes toward interest, meaning your principal balance barely decreases. It can take decades to pay off a moderate balance this way.
How can I pay off my credit card faster?
Pay more than the minimum every month. Stop using the card for new purchases while paying it down. Consider transferring the balance to a 0% introductory APR card, or taking out a personal loan with a lower interest rate.