1. What is the Credit Card Balance Formula?

The Credit Card Remaining Balance formula calculates how much you still owe on your credit card after making M payments, taking into account the interest that accrues on your balance.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( P \) — Original principal amount (initial balance)
• \( R \) — Monthly interest rate (APR divided by 12)
• \( N \) — Total loan tenure in months
• \( M \) — Number of payments made

Explanation: The formula accounts for compound interest over time and shows how much of your payments have gone toward reducing the principal versus paying interest.

3. Importance of Calculating Remaining Balance

Details: Knowing your remaining balance helps you understand your debt repayment progress, plan your finances, and estimate how much interest you'll pay over time.

4. Using the Calculator

Tips: Enter your original credit card balance, annual percentage rate (APR), total repayment period in months, and how many payments you've already made.

5. Frequently Asked Questions (FAQ)

Q1: Why does my balance decrease slowly at first?
A: Early payments go mostly toward interest due to compounding. More of each payment goes toward principal as the balance decreases.

Q2: How does APR affect my remaining balance?
A: Higher APR means more of each payment goes to interest, slowing principal reduction and increasing total interest paid.

Q3: What if I make extra payments?
A: Extra payments reduce principal faster, decreasing total interest and shortening repayment time.

Q4: Does this work for minimum payments?
A: Yes, but minimum payments often barely cover interest, leading to very slow principal reduction.

Q5: How accurate is this calculator?
A: It provides a good estimate assuming fixed APR and consistent payments. Actual results may vary with rate changes or payment adjustments.