Credit Card Interest Calculator
See how long it takes to pay off your credit card debt and how much interest you'll pay.
Card Details
Payoff Summary
Payoff Time
3 years, 10 months
Total Interest
$1,927
Total Paid
$6,927
How Credit Card Interest Works
Credit card interest compounds daily. Your APR is divided by 365 to get a daily periodic rate. Each day, that rate is applied to your current balance—including yesterday's interest. This daily compounding makes credit card debt significantly more expensive than most people realize.
Example: $5,000 balance at 22% APR with minimum payments only (2% of balance or $25, whichever is higher): payoff takes approximately 17 years and costs over $8,000 in interest—totaling $13,000+ for a $5,000 debt.
The Minimum Payment Trap
Credit card issuers set minimum payments deliberately low to maximize interest collected. Here's the true cost of minimum-only payments on a $5,000 balance at 22% APR:
| Monthly Payment | Months to Pay Off | Total Interest |
|---|---|---|
| Minimum only (~$100) | 204 months (17 yrs) | $8,109 |
| $150/month | 50 months (4.2 yrs) | $2,412 |
| $200/month | 32 months (2.7 yrs) | $1,410 |
| $300/month | 20 months (1.7 yrs) | $853 |
Paying $200/month instead of minimum saves $6,699 in interest and pays off debt 14 years earlier.
Balance Transfer Strategy
A 0% APR balance transfer card can dramatically cut payoff cost—if used correctly:
- Apply for a card offering 0% intro APR for 15-21 months
- Transfer your high-interest balance (transfer fee: typically 3-5%)
- Divide the balance by the months of 0% period
- Pay exactly that amount every month
- Never miss a payment (one missed payment often ends the 0% period)
Example: $5,000 at 22% APR transferred to 0% for 18 months with 3% fee ($150). If you pay $278/month for 18 months, total cost: $5,150—saving nearly $8,000 compared to minimum payments.
Average Credit Card APRs by Credit Score (2024)
| Credit Score | Average APR |
|---|---|
| Excellent (750+) | 16-18% |
| Good (700-749) | 19-22% |
| Fair (650-699) | 23-26% |
| Poor (below 650) | 27-30%+ |
Frequently Asked Questions
Does paying the statement balance in full avoid all interest?
Yes—if you pay the full statement balance by the due date every month, you pay zero interest. Credit cards offer a grace period (typically 21-25 days) during which no interest accrues. This makes credit cards free tools when used responsibly.
How is the minimum payment calculated?
Most issuers calculate the minimum as the greater of: (1) a flat amount like $25-35, or (2) a percentage of the balance (usually 1-3%). This percentage decreases as your balance shrinks, extending your payoff timeline indefinitely if you only pay minimums.
Should I pay off credit cards or invest?
Credit card APRs of 18-30% are guaranteed negative returns. No investment reliably earns 20%+ consistently. Always prioritize paying off credit card debt before investing (exception: always capture employer 401k match first—that's a guaranteed 50-100% return).
What happens if I only pay the minimum for years?
You'll pay several times the original balance in interest, and your credit utilization stays high—hurting your credit score. A $1,000 balance at 22% APR with 2% minimum payments takes nearly 9 years to pay off and costs over $1,000 in interest alone.