How long a balance takes, and what it costs

What this works out

How long a credit card balance takes to clear, what it costs in interest, and what happens month by month. Two ways of paying: whatever the card asks for, which is where it starts, or the same amount every month.

The table underneath is the schedule — every payment, split into interest and what actually comes off the balance.

The minimum payment is the whole story

A credit card minimum is not a fixed sum. It is usually a small percentage of the balance plus that month’s interest, floored at a fixed amount. So it falls every month, and each payment removes less than the one before it.

That single property is why a card takes years:

Paying	Clears in	Interest
The 2% minimum	112 months	2,498.51
100 a month	45 months	1,495.48
117.25 a month	36 months	1,155.70
150 a month	26 months	814.94

Look at the first and third rows. The minimum starts at 117.25 — higher than either of the fixed payments underneath it — and still takes three times as long as paying that same 117.25 every month, because it does not stay there. By month 111 it has fallen to 25, which is the floor.

The floor is what eventually clears the card. A percentage of a falling balance approaches zero and never arrives; without the “or 25, whichever is greater” clause there is no payoff at all, and this tool says so rather than producing a number.

Where the money goes

• Interest57.2557.3%
• Off the balance42.7542.8%

At 22.9% APR, a balance of 3,000 accrues 57.25 in the first month. So on a payment of 100:

month 1   payment 100.00   interest 57.25   off the balance 42.75
month 2   payment 100.00   interest 56.43   off the balance 43.57
month 3   payment 100.00   interest 55.60   off the balance 44.40

Fifty-seven per cent of the first payment is interest. That share falls every month as the balance does, which is why the final year of a payoff moves so much faster than the first — the last payment on this schedule is 95.48, of which 1.79 is interest.

Time to clear

3 years 9 months

Interest paid

1,495.48

Monthly payment

100

Every value

Monthly payment	Time to clear	Interest paid
60	13 years 8 months	6,784.48
70	7 years 7 months	3,306.27
80	5 years 7 months	2,321.81
90	4 years 6 months	1,813.18
100	3 years 9 months	1,495.48
110	3 years 3 months	1,276.63
120	2 years 11 months	1,115.87
130	2 years 7 months	992.4
140	2 years 4 months	894.4
150	2 years 2 months	814.94
160	2 years	748.86
170	1 year 10 months	693.11
180	1 year 9 months	645.43
190	1 year 7 months	603.94
200	1 year 6 months	568.09
210	1 year 5 months	536.32
220	1 year 4 months	507.94
230	1 year 4 months	482.88
240	1 year 3 months	460.47
250	1 year 2 months	439.81
260	1 year 2 months	421.07
270	1 year 1 month	404.33
280	1 year 1 month	388.34
290	1 year	374.38
300	1 year	360.97

The line between paying it off and not

There is a threshold, and it is sharper than anyone expects:

paying 57.25  ->  refused. The balance never falls.
paying 57.26  ->  462 months, 23,444.94 of interest.

One cent. Below the first month’s interest the balance grows for ever, so there is no schedule to produce and this tool declines rather than returning a plausible number of months. A cent above it, the card clears — in thirty-eight years, having cost nearly eight times what was borrowed.

That is not a quirk of the arithmetic. It is the shape of the whole product, and it is why the size of a payment matters far more than the size of a balance.

The method

Interest is charged monthly at the APR divided by twelve, which is what a statement does. It is worth knowing that this makes the true annual cost higher than the headline: 22.9% compounded monthly is an effective 25.46%. That conversion is the APR and APY calculator’s job; this one stays faithful to the statement so the figures can be checked against one.

The payment is rounded before it is applied, not after. Two per cent of 1,234.57 is 24.6914 and no card asks for a fraction of a cent. Rounding only the number in the table produced a schedule whose rows did not add up — the payment shown was not the interest plus the principal shown — and that was caught by a test rather than by reading it.

The final payment is only what is left, which is what actually happens and what makes the totals reconcile with the schedule.

Money is decimal rather than binary floating point throughout. On a schedule of 112 rows, a fraction of a unit per month is a visible discrepancy between a total and the sum of the column above it.

A worked example

3,000 at 22.9%, paying the 2% minimum — which is where this page starts, because it is what the card actually asks for:

Time to clear	112 months
Interest paid	2,498.51
Total paid	5,498.51
First payment	117.25

That first payment falls every month afterwards, which is the whole reason the figure above it is nine years.

On a fixed 100 a month instead: 45 months and 1,495.48 of interest — a third of the time and 40% of the cost, for a payment that starts lower than the minimum does.

These are the same figures asserted in this tool’s test file, so the page and the formula cannot drift apart without the build going red.

What it does not do

It assumes nothing further is charged to the card, which is the commonest reason a real balance does not follow a schedule like this one. It does not model promotional or balance-transfer rates, transfer fees, cash advances at a higher rate, annual fees, late fees, or a missed payment. It uses monthly interest where most issuers accrue daily. And it does not know your card’s actual minimum payment terms, which vary by issuer and by country — both figures are editable for exactly that reason.

For a fixed-term debt with a set end date rather than a revolving balance, loan repayment is the tool. For what a nominal APR actually costs over a year, that is the effective annual rate.

Each month, in this order:

  interest  = round(balance x apr / 100 / 12)
  due       = balance + interest
  payment   = round(what you pay this month)
  principal = payment - interest
  balance   = due - payment

On a fixed payment:
  payment = the same amount every month

On the minimum:
  payment = max(balance x percent + interest, floor)

The last payment is only what is left, so the
totals reconcile with the schedule.

round = to the nearest minor unit, half up.