# Credit card payoff calculator

> Calculate how long a credit card balance takes to pay off on minimum payments versus a fixed monthly payment, and the interest each costs.

Interactive version: https://www.calcopenly.com/finance/credit-card-payoff-calculator
Subject: Finance calculators

Card interest accrues each month at APR ÷ 12 on the balance, and the minimum payment is recalculated from the new balance every month, so it shrinks as the debt falls and the payoff drags on. The calculator runs two schedules month by month, one on minimum payments and one at a fixed amount, and compares the months and interest each takes.

With the defaults, a 5,000 balance at 22.9% APR, a fixed 200 a month clears the card in 35 months with 1,859.78 of interest. The minimum (1% of the balance plus the month's interest, at least 25) starts at 145.42 and takes 232 months, 19.3 years, costing 8,453.56.

Issuers charge interest daily on the average daily balance, so statements differ slightly from this monthly model, and new purchases are not included. Check your card agreement for its minimum payment rule.

## Inputs

- **Card balance**
- **APR**
- **Fixed monthly payment**
- **Minimum payment rule** (options: % of balance plus interest, % of statement balance)
- **Minimum payment percentage**
- **Minimum payment floor**: The smallest minimum payment the issuer accepts.

## Results

- Months to pay off (fixed payment) — main result
- Interest paid (fixed payment)
- Months to pay off (minimum payments)
- Interest paid (minimum payments)
- Interest saved
- First minimum payment

## Formula

$$
B_{k} = B_{k-1}(1 + r) - \min\big(\text{payment}_k,\ B_{k-1}(1+r)\big),\qquad r = \frac{\text{APR}}{1200}
$$

## Worked examples

### 5,000 at 22.9%: 200 a month vs 1% plus interest

- Card balance: 5000
- APR: 22.9%
- Fixed monthly payment: 200
- Minimum payment rule: % of balance plus interest
- Minimum payment percentage: 1%
- Minimum payment floor: 25
- **Months to pay off (fixed payment): 35**
- **Interest paid (fixed payment): 1,859.78**
- **Months to pay off (minimum payments): 232**
- **Interest paid (minimum payments): 8,453.56**
- **Interest saved: 6,593.78**
- **First minimum payment: 145.42**
- Checked against: Python decimal (prec 50) month-by-month simulation, interest at APR/12 then payment

### 3% of statement balance with a 35 floor

- Card balance: 5000
- APR: 22.9%
- Fixed monthly payment: 200
- Minimum payment rule: % of statement balance
- Minimum payment percentage: 3%
- Minimum payment floor: 35
- **Months to pay off (minimum payments): 180**
- **Interest paid (minimum payments): 7,070.63**
- **First minimum payment: 152.86**
- Checked against: Python decimal month-by-month simulation

### Payment larger than the balance — one month

- Card balance: 1000
- APR: 12%
- Fixed monthly payment: 2000
- Minimum payment rule: % of statement balance
- Minimum payment percentage: 2%
- Minimum payment floor: 25
- **Months to pay off (fixed payment): 1**
- **Interest paid (fixed payment): 10.00**
- **First minimum payment: 25.00**
- **Months to pay off (minimum payments): 52**
- Checked against: 1000 × 1% = 10 interest, cleared in one payment; the 25 floor exceeds 2% × 1010 (Python decimal simulation for 52 months)

### Zero APR

- Card balance: 1200
- APR: 0%
- Fixed monthly payment: 100
- Minimum payment rule: % of statement balance
- Minimum payment percentage: 2%
- Minimum payment floor: 25
- **Months to pay off (fixed payment): 12**
- **Interest paid (fixed payment): 0.00**
- **Months to pay off (minimum payments): 48**
- **Interest paid (minimum payments): 0.00**
- Checked against: 1200 / 100 = 12 months; 2% of the balance never exceeds the 25 floor, so 1200 / 25 = 48 months

## Questions

### How long does it take to pay off a credit card with minimum payments?

Often decades, because the minimum shrinks with the balance. A 5,000 balance at 22.9% APR on a minimum of 1% plus interest (at least 25) takes 232 months, 19.3 years, and costs 8,453.56 in interest. In the US, Regulation Z (12 CFR 1026.7(b)(12)) requires each statement to show the payoff time and total cost at the minimum payment.

### How much do I need to pay to clear my card in 3 years?

Use the loan payment formula with 36 months. Clearing 5,000 at 22.9% APR in 36 months takes 193.29 a month and 1,958.37 of interest; in 24 months it takes 261.62 a month and 1,278.84 of interest. US statements show the 36-month figure and the saving against minimum payments, unless the minimum already clears the balance within 3 years (Regulation Z).

### How is credit card interest calculated?

The APR is divided into a periodic rate and applied to the balance. At 22.9% APR the monthly rate is 22.9 ÷ 12 = 1.908%, so a 5,000 balance accrues 95.42 of interest in the first month. Issuers usually apply a daily rate to the average daily balance instead, which gives a slightly different figure, and interest is charged on interest left unpaid.

### What is the average credit card interest rate?

22.15% APR for US accounts assessed interest in the second quarter of 2026, according to the Federal Reserve's G.19 consumer credit release of 8 September 2026. At that rate, 5,000 paid off at 200 a month takes 34 months and costs 1,767.76 in interest, against 35 months and 1,859.78 at the 22.9% default.

### How much faster does paying more than the minimum clear a card?

Each extra amount shortens the payoff sharply. On 5,000 at 22.9% APR, 150 a month takes 54 months and 3,021.92 of interest, 200 takes 35 months and 1,859.78, and 300 takes 21 months and 1,075.70. Doubling the payment from 150 to 300 cuts the interest by 64%.

### How accurate is the credit card payoff calculator?

Accuracy depends on your inputs and the method's assumptions. Decimal arithmetic uses 50 significant digits, but estimates, numerical methods and source data can be less precise; the displayed rounding does not remove those limits. It is checked against 4 worked examples whose answers come from independent sources; for example, “5,000 at 22.9%: 200 a month vs 1% plus interest” is checked against Python decimal (prec 50) month-by-month simulation, interest at APR/12 then payment.

### Where does the method come from?

Regulation Z, Appendix M1 to Part 1026 — Repayment disclosures (minimum payment repayment estimates); Consumer Financial Protection Bureau — Understanding minimum payments.

## Sources

- [Regulation Z, Appendix M1 to Part 1026 — Repayment disclosures (minimum payment repayment estimates)](https://www.consumerfinance.gov/rules-policy/regulations/1026/m1/)
- [Consumer Financial Protection Bureau — Understanding minimum payments](https://www.consumerfinance.gov/consumer-tools/educator-tools/youth-financial-education/teach/activities/understanding-minimum-payments/)

_Note: financial information, not professional advice._