How long your balance will take
Credit cards charge some of the highest interest rates in consumer lending, often more than 20% APR. Paying only a little more than the interest each month keeps the balance alive for years. This calculator shows how many months a fixed monthly payment takes to clear a balance, what the interest will cost in total, and what payment you would need to be debt-free by a target date.
The formulas
With B the balance, P the monthly payment and i the monthly rate (APR ÷ 12):
- Months to pay off = −ln(1 − i × B ÷ P) ÷ ln(1 + i)
- Total interest = months × P − B
- Payment to clear the balance in n months = B × i ÷ (1 − (1 + i)^−n)
If the payment does not exceed the first month’s interest (B × i), the balance never goes down. Card issuers actually apply a daily rate to your average daily balance, which gives very close results. The calculator assumes you make no new purchases.
Worked example
You owe $6,000 on a card at 22% APR and pay $200 a month.
- Monthly rate = 22% ÷ 12 = 1.833%; the first month’s interest is $110, so only $90 reduces the balance.
- Months to pay off = −ln(1 − 0.01833 × 6,000 ÷ 200) ÷ ln(1.01833) = 44 months.
- Total interest: about $2,791, almost half the original balance.
- To be debt-free in 24 months, you would need $311 a month, and the interest would drop to $1,470.
Payoff time by payment
For the same $6,000 at 22%:
| Monthly payment | Months | Total interest |
|---|---|---|
| $150 | 73 | $4,913 |
| $200 | 44 | $2,791 |
| $250 | 32 | $1,979 |
| $300 | 25 | $1,543 |
| $400 | 18 | $1,080 |
| $500 | 14 | $838 |
Strategies that work
- Pay a fixed amount, not the minimum. Minimum payments shrink as the balance falls, which stretches payoff over many years. Your statement’s Minimum Payment Warning shows how long.
- Avalanche: put every extra dollar on the card with the highest APR while paying the minimum on the others. It minimizes interest.
- Snowball: clear the smallest balance first for quick wins. It costs a bit more but helps some people stick to the plan.
- Balance transfer: a 0% intro APR card can stop interest for 12 to 21 months. Transfer fees are usually 3 to 5%, and the regular APR applies to anything left after the promotion.
- Consolidation loan: a personal loan at a lower fixed rate turns the balance into fixed payments with an end date.
If you are struggling with payments, a nonprofit credit counseling agency can set up a debt management plan with reduced rates.