Credit Card Payoff Calculator

It depends on your balance, interest rate, and monthly payment. For a $5,000 balance at 20% APR: paying $100/month takes 9 years and costs $5,840 in interest. Paying $200/month takes 2.5 years and costs $1,314 in interest. Doubling your payment can cut time and interest by more than half.

Credit card minimum payments (usually 1-3% of balance) are designed to maximize interest for the lender. A $5,000 balance at 20% APR with only minimum payments could take 25+ years to pay off and cost over $9,000 in interest - nearly double the original debt. Always pay more than the minimum.

The avalanche method (paying highest interest rate first) saves the most money mathematically. The snowball method (paying smallest balance first) provides psychological wins that keep you motivated. Both work - the avalanche saves more interest, but the snowball has higher completion rates.

Credit card interest is calculated daily on your balance. For a $5,000 balance at 20% APR, about $83/month goes to interest initially. If you pay $150, only $67 reduces your balance. As your balance decreases, more of each payment goes to principal. This is why early extra payments are so powerful.

Generally, pay off high-interest debt first. If your card charges 20% APR and savings earns 4%, paying off debt gives you an effective 20% return. Exception: keep a small emergency fund ($1,000) so you don't need to use the card again. After that, aggressively pay down debt.