1. What is the Credit Card Payoff Calculator?

This calculator estimates how long it will take to pay off a credit card balance when making fixed monthly payments, taking into account the interest charges.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• \( P \) — Principal balance ($)
• \( D \) — Monthly payment ($)
• \( R \) — Monthly interest rate (APR/12)
• \( T \) — Time to payoff (months)

Explanation: The formula calculates how many months it will take to pay off the balance by accounting for the decreasing principal and compounding interest each month.

3. Importance of Payoff Calculation

Details: Understanding your payoff timeline helps with financial planning, shows the true cost of carrying a balance, and can motivate debt repayment strategies.

4. Using the Calculator

Tips: Enter your current credit card balance, your fixed monthly payment amount, and the card's annual percentage rate (APR). All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What if my payment is too low to pay off the balance?
A: The calculator will show "Never" if your payment doesn't cover the monthly interest (payment ≤ principal × monthly rate).

Q2: Does this account for minimum payments?
A: No, this assumes fixed payments. Minimum payments typically extend payoff time significantly.

Q3: How accurate is this calculation?
A: It's mathematically precise for fixed payments and rates, but actual results may vary if your APR changes.

Q4: Should I include new purchases in this calculation?
A: No, this assumes no additional charges. For accuracy, stop using the card while paying it off.

Q5: How can I pay off my card faster?
A: Increase monthly payments, make biweekly payments, or transfer to a lower-interest card.