Credit Card Interest Calculator

What this calculator measures

This calculator models the real cost of carrying a credit card balance — the total interest you'll pay, how long repayment takes, and what happens if you rely on minimum payments. You enter three things: your balance, your APR, and your monthly payment. The calculator simulates repayment month by month and shows you the full picture.

Why carrying a balance becomes expensive

Credit card APRs are high — often 18% to 30% or more. On a $3,000 balance at 20% APR, that's about $50 in interest added in the first month alone. The interest doesn't just sit there — it compounds against your balance every billing cycle. Even with a reasonable monthly payment, a significant portion of it goes to interest rather than paying down what you actually owe.

Why minimum payments feel manageable but extend debt

Card issuers set minimum payments low — often 2% of your balance or $25, whichever is higher. On a $3,000 balance, that's about $60. It feels like you're making progress. But at a 20% APR, about $50 of that $60 goes straight to interest. Only $10 reduces the actual balance. And as the balance slowly falls, so does the minimum — slowing payoff even further. What starts as a manageable debt can stretch into a decade or more of payments if you only pay the minimum.

How interest compounds over time

Most credit cards compound interest daily, though the effect shows up monthly on your statement. The key dynamic is this: interest is charged on your current unpaid balance. If that balance stays high because you're only paying the minimum, interest keeps being calculated on a large number — meaning the total interest cost over time is much higher than it might appear from the APR alone. The APR tells you the rate. The calculator shows you the consequence.

How to use the result

The most useful thing you can do with these numbers is compare. See how much total interest you'd pay at your current payment vs. minimum payments only. Then see what happens if you add $25, $50, or $100 per month — the "What if you paid a little more?" section above shows exactly that. The interest savings from modest payment increases are often surprising.

A note on accuracy

This calculator uses monthly compounding as an approximation. Most credit cards actually compound daily, which results in slightly higher interest than shown here. For your exact repayment figures, your card's statement or a call to your issuer will give you precise numbers. This calculator is designed to show the general shape of the cost — not to replace your card's official disclosures.