💰 Financial
Credit Card Payoff Calculator
Determine exactly how much you need to pay each month to eliminate your credit card debt within a specific timeframe.
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Formula
M = B × [r(1+r)^n] / [(1+r)^n - 1]M- Required monthly payment
B- Current balance
r- Monthly interest rate
n- Target payoff time in months
Example
Paying Off a Card in 18 Months
You have a $3,000 balance at 18.9% APR and want to be debt-free in a year and a half.
- Identify target parameters: B = $3,000, Annual Rate = 18.9%, Target Term = 18 months.
- Convert to monthly values: r = 0.189 / 12 = 0.01575.
- Apply the formula to find the required payment.
- Result: You need to pay $192.67 every month. Total interest paid will be $468.06.
Frequently Asked Questions
A balance transfer card offers a 0% introductory APR for a set period (like 12 to 21 months). If you move your high-interest debt to this card and pay it off before the period ends, you can save hundreds in interest.
Yes, lowering your credit card balance decreases your credit utilization ratio, which is one of the most significant factors in determining your credit score.