How to use the credit card interest calculator
- 1 Enter your card balance and APR.
- 2 Enter your monthly payment and any new charges.
- 3 Check the minimum payment terms from your statement (often 1% plus interest, at least $25).
- 4 Read the interest this month, payoff time and total interest.
Worked example
A $5,000 balance at 22.99% APR, paying $200 a month. Interest this month is $95.79 (a daily rate of 0.0630%). At $200 a month, the card is paid off in 2 years 11 months with $1,871.08 of interest. Paying only the minimum (1% plus interest, at least $25, starting at $145.79) would take 19 years 1 month and cost $8,339.53.
Paying less interest
- Pay the full statement balance to keep the grace period.
- Pay more than the minimum every month.
- Ask for a lower APR: it often works.
- Consider a 0% balance transfer with a payoff plan.
Set a payoff date with the Credit Card Payoff Calculator, tackle several cards with the Debt Snowball Calculator, and compare with the Personal Loan Calculator.
Features
APR in dollars
Interest this month and over a year at your balance.
Payoff time
Months and total interest at your payment.
Minimum payment trap
How long paying only the minimum takes.
When to use it
Several cards
Plan the order with the Debt Snowball Calculator.
A single payoff goal
Set a date with the Credit Card Payoff Calculator.
Consolidating
Compare with a lower-rate loan in the Personal Loan Calculator.
Making room to pay more
Find extra money with the Budget Calculator.
Related Money and Budget tasks
Frequently asked questions
How is credit card interest calculated?
Most cards divide the APR by 365 to get a daily periodic rate, apply it to each day's balance and add it up at the end of the billing cycle. That comes to about the balance × APR ÷ 12 each month.
How much interest will I pay on $5,000?
At 22.99% APR, about $95.79 in the first month. Paying $200 a month, it takes about 2 years 11 months and $1,871 of interest to clear.
What is the daily periodic rate?
The APR divided by 365. A 22.99% APR is about 0.063% a day.
How do I avoid credit card interest?
Pay the full statement balance by the due date every month. Most cards give a grace period on new purchases only when you paid the previous balance in full.
How is the minimum payment worked out?
It varies by issuer. A common formula is 1% of the balance plus that month's interest and fees, with a floor such as $25. Your statement shows the formula and how long minimum payments would take.
Why does paying the minimum take so long?
Most of the minimum goes to interest, and the minimum shrinks as the balance falls. In the example, minimum payments take over 19 years and $8,340 of interest.
What is the average credit card APR?
Average APRs on accounts that pay interest have been above 20% in recent years. Your rate depends on your credit and the card.
Does a balance transfer save money?
A 0% intro APR balance transfer can save a lot if you can pay off the balance before the promotion ends. Transfer fees of 3% to 5% usually apply.
Do cash advances cost more?
Yes. Cash advances usually have a higher APR, no grace period, and a fee of 3% to 5%.
Will paying more improve my credit score?
Lowering your balance reduces your credit utilization, the share of your limit you use, which is a large part of your score.
Results are estimates based on the official rates linked above. Confirm important figures with the issuing authority or a qualified adviser before you act on them.
Built and reviewed by Hamza Farooq, founder and lead developer
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