How this calculator works
Each month, your card charges interest on the balance (your APR divided by 12). Your payment covers that interest first, and anything left reduces the balance. This calculator runs that process month by month for your fixed payment and for minimum payments, then compares the two.
Minimum payments are modeled the way many US issuers calculate them: interest plus 1% of the balance, with a $25 floor. Your card's formula may differ slightly, so check your statement.
The minimum payment trap
Because the minimum shrinks as your balance shrinks, paying only the minimum can stretch a modest balance across decades. Your statement is required by law to show how long minimum payments will take, and the number is usually surprising.
Example calculation
You owe $6,000 on a card with a 22.99% APR.
- Minimum payments only
- 20 yr 10 mo
- Interest with minimums
- $10,404.74
- Paying $250 a month
- 2 yr 9 mo
- Interest at $250 a month
- $2,113.20
- You save
- $8,291.54
Ways to pay off faster
- Pay a fixed amount, not the minimum. Even $50 more a month cuts years off the payoff.
- Try a balance transfer. A 0% intro APR card stops interest for 12 to 21 months, though there's usually a 3% to 5% transfer fee.
- Use the avalanche method. With several cards, pay extra on the highest APR first to save the most interest.
- Stop adding new charges. Switch to debit or cash while you pay the card down.
Frequently asked questions
Does paying off my card improve my credit score?
Usually, yes. Lowering your balance reduces your credit utilization, one of the biggest factors in your score.
Should I pay off debt or save first?
Most experts suggest a small emergency fund first, then aggressive payoff of high-interest cards, since few investments reliably beat a 20% APR.
Will my card close if I pay it off?
No. Paying the balance to zero doesn't close the account. Keeping it open can help your credit history.