Monthly Repayment Credit Card Calculator

Credit Card Payoff Formula:

\[ T = \frac{\log\left(\frac{P}{P - D \times R}\right)}{\log(1 + R)} \]

Time to Payoff:

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1. What is the Credit Card Payoff Formula?

The credit card payoff formula calculates how long it will take to pay off credit card debt when making fixed monthly payments, taking into account the interest rate.

2. How Does the Calculator Work?

The calculator uses the following formula:

\[ T = \frac{\log\left(\frac{P}{P - D \times R}\right)}{\log(1 + R)} \]

Where:

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

Explanation: The formula accounts for the compounding interest on the remaining balance each month as payments are made.

3. Importance of Payoff Calculation

Details: Understanding how long it will take to pay off credit card debt helps with financial planning and motivates debt repayment strategies.

4. Using the Calculator

Tips: Enter your current credit card balance, the monthly payment you can afford, and your card's APR. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Why does the calculator say "Never"?
A: If your monthly payment is less than the monthly interest charges, your balance will never be paid off.

Q2: How can I pay off my debt faster?
A: Increase your monthly payment, reduce your interest rate (e.g., through balance transfer), or both.

Q3: Does this account for minimum payments?
A: No, this calculates payoff time for fixed payments. Minimum payments typically extend payoff time significantly.

Q4: What if I make additional payments?
A: Extra payments will reduce the payoff time. You'd need to recalculate with your new average monthly payment.

Q5: How accurate is this calculator?
A: It provides a good estimate assuming fixed payments and interest rate. Actual results may vary slightly due to rounding in real credit card statements.