Transparent method
The formula
Worked example
Example inputs
How to interpret the result
A minimum payment is set as a small percentage of the balance, so it shrinks as the balance falls and stretches the payoff. On a $6,000 balance at 24 percent APR with a 3 percent minimum, paying only the minimum takes about 219 months, over 18 years, and costs about $10,442 in interest. Paying a fixed $200 a month instead clears the same debt in about 47 months for around $3,255 of interest, a difference of thousands from one decision.
Before you rely on it
What to check
Set a fixed payment above the minimum and hold it as the balance falls. The fixed amount is what turns a slow shrink into a payoff date.
The common error
Where people go wrong with credit card minimum payment calculator
Reading the minimum as the recommended payment. It is the least the issuer will accept, and it is built to keep the balance outstanding for a long time.
Sensitivity evidence
How card APR changes the estimated payoff time
| Card APR | Estimated payoff time | Estimated total interest |
|---|---|---|
| 20.0% | 172.0 months | $6,592 |
| 22.0% | 192.0 months | $8,248 |
| 24.0%worked example | 219.0 months | $10,442 |
| 26.0% | 256.0 months | $13,492 |
| 28.0% | 311.0 months | $18,032 |
Every input, tested
Which input moves the estimated payoff time most
| Input | Tested from | To | Estimated payoff time at each end | Swing |
|---|---|---|---|---|
| Minimum payment rate | 2.0% | 4.0% | 0.0 months to 131.0 months | 131.0 months (60%) |
| Card APR | 22.0% | 26.0% | 192.0 months to 256.0 months | 64.0 months (29%) |
| Card balance | $5,400 | $6,600 | 208.0 months to 228.0 months | 20.0 months (9.1%) |
| Fixed minimum | $32 | $39 | 228.0 months to 208.0 months | 20.0 months (9.1%) |
Two variables at once
Estimated payoff time by card APR and card balance
| Card APR \ Card balance | $4,800 | $6,000 | $7,200 |
|---|---|---|---|
| 20.0% | 155.0 months | 172.0 months | 185.0 months |
| 22.0% | 173.0 months | 192.0 months | 208.0 months |
| 24.0% | 197.0 months | 219.0 months | 237.0 months |
| 26.0% | 229.0 months | 256.0 months | 278.0 months |
| 28.0% | 277.0 months | 311.0 months | 338.0 months |
Step by step
The worked example, input by input
| Input | Value used |
|---|---|
| Card balance | $6,000 |
| Card APR | 24.0% |
| Minimum payment rate | 3.0% |
| Fixed minimum | $35 |
| Estimated payoff time | 219.0 months |
| Estimated total interest | $10,442 |
Where the inputs come from
Card balance and APR come from your statement. The minimum payment rate is the percentage of the balance the issuer requires, commonly 1% plus interest or 2% to 3%, and the fixed minimum is the floor, often $25 to $35. Your cardholder agreement states the formula. Assume no new purchases so the result shows the pure cost of paying only the minimum.
When the result stops applying
Issuers calculate minimums differently, some as a percentage of the balance and others as a percentage of the balance plus interest and fees, so the schedule varies. The model assumes a fixed APR and no new charges. Late fees and penalty rates change the outcome. Federal rules require statements to show the payoff time at the minimum.
What to compare it with
Set a fixed payment with the credit card payoff calculator, or a target date with the credit card payment calculator. The credit card interest page shows one month's split. The balance transfer and debt consolidation pages show ways to cut the rate. Autopay above the minimum is a simple habit.
People also ask
Frequently asked questions
Why does paying the minimum take so long?
The minimum is a small percentage of the balance, so most of the payment covers interest, and the payment shrinks as the balance falls, stretching the timeline.
How much interest do minimum payments cost?
Often more than the original balance. On a $6,000 balance at 24%, minimum payments can cost about $10,000 of interest over 18 years.
Is the minimum payment required to be shown on statements?
Yes. Federal law requires statements to show how long it would take to pay off the balance at the minimum and the total cost.