Credit Card Interest Calculator

Find out how long it takes to pay off a credit card balance and how much interest it costs, based on your starting balance, APR, and monthly payment.

Quick Facts

Formula
Monthly interest = balance × (APR ÷ 12)
Interest accrues on the remaining balance and is added before your payment is applied, then the cycle repeats.
Compounding
Monthly, on the unpaid balance
This mirrors the method issuers use for the minimum-payment payoff estimate on U.S. credit card statements.

Your Results

Calculated
Time to pay off
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Months until balance reaches $0
Total interest paid
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Cost of carrying this balance
Total amount paid
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Principal plus interest combined
Interest cost ratio
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Total interest as % of starting balance

Ready

Enter your balance, APR, and monthly payment, then press Calculate.

How the Credit Card Interest Calculator works

Credit card issuers typically charge interest monthly on whatever balance remains after your last payment, using the formula monthly interest = balance × (APR ÷ 12). That interest is added to your balance before your next payment is applied, then the cycle repeats until the balance reaches zero. This calculator runs that exact month-by-month simulation using the balance, APR, and monthly payment you enter, which is the same simplified monthly-compounding method behind the minimum-payment payoff estimate required in the disclosure box on U.S. credit card statements.

The month-by-month calculation

Each simulated month follows two steps: first, interest = balance × (APR / 12 / 100) is added to the balance; second, your monthly payment is subtracted. The calculator repeats this until the balance is fully paid off, tracking how many months it takes and how much interest accumulates along the way.

Why the payment amount matters so much

  • Payment above the interest: if your payment exceeds the monthly interest charge, the balance shrinks a little more each month, which lowers next month's interest charge too — the payoff accelerates.
  • Payment near the interest: if your payment barely covers the interest, principal reduction is slow and the payoff can stretch out for years, with total interest sometimes exceeding the original balance.
  • Payment at or below the interest: the balance stops shrinking and can grow instead (negative amortization) — the calculator flags this case rather than showing a payoff time.

Worked example

A $5,000 balance at 22.99% APR with $200 paid every month accrues roughly $96 of interest in the first month alone (5000 × 22.99% / 12). Because $200 comfortably covers that interest, the balance falls and each later month's interest charge is a little smaller, until the balance is paid off after a couple of years with several hundred dollars of total interest along the way — the calculator gives you the exact figures for your own numbers.

What this does not include

This is a payoff-time and interest-cost calculator, not a full statement simulator: it assumes no new purchases, cash advances, fees, or promotional 0% periods, and it uses monthly compounding rather than the daily compounding many issuers apply to the average daily balance. Treat the result as a close, standard approximation rather than a duplicate of your next statement.

Frequently Asked Questions

How is credit card interest calculated?
Most issuers charge interest monthly on your remaining balance using a simple periodic formula: monthly interest = balance × (APR / 12). That interest is added to the balance before your payment is applied, so paying down the balance faster shrinks every future interest charge. This calculator repeats that step month by month until the balance reaches zero.
What happens if my payment does not cover the interest?
If your monthly payment is less than or equal to the first month's interest charge, the balance never shrinks - it grows instead, since unpaid interest gets added back to the principal. This is called negative amortization. The calculator flags this case and asks for a higher payment amount.
Why does a higher monthly payment save so much interest?
Interest is charged on whatever balance remains, so a larger payment reduces the balance faster and shrinks every subsequent month's interest charge. Because the effect compounds month after month, even a modest increase in payment size can cut both the payoff time and the total interest paid substantially.
Does this match the exact numbers on my credit card statement?
It will be close but not necessarily exact. Many issuers compound daily on the average daily balance rather than monthly on a single balance snapshot, and new purchases, fees, or promotional rates will change the real result. This calculator uses the same simplified monthly-compounding method required in the minimum-payment warning box on U.S. credit card statements, which is a standard, widely used approximation.

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