Credit Card Payoff Calculator

Why the minimum payment is designed to be slow

A minimum payment is typically a small percentage of the outstanding balance, with a fixed floor underneath it. Because it is a percentage, it falls as the balance falls — so the payment shrinks at exactly the rate that keeps the debt alive. On a card at a typical rate, paying only the minimum can take well over a decade and cost more in interest than the original purchase.

Compare the first-month interest figure against the minimum payment. If they are close, almost nothing is going against principal.

Fixing the payment changes everything

Paying a fixed amount rather than the minimum — even the same amount as today's minimum, held constant — dramatically shortens the term, because the whole payment keeps working against a shrinking balance rather than shrinking with it.

Cards charge interest differently from loans

Most cards apply interest daily to the average balance, and many give an interest-free grace period only if the statement balance was paid in full. Once you carry a balance, that grace period usually disappears and new purchases start accruing immediately.

Balance transfers

A zero-percent transfer can be a genuine reset, but the transfer fee is real and the promotional window ends. It only helps if you clear the balance inside the window; otherwise you have paid a fee to defer the problem.