1. What is the Credit Card Payoff Calculator?

This calculator estimates how long it will take to pay off multiple credit card debts based on your current balances, monthly payments, and interest rates. It helps you understand the time commitment needed to become debt-free.

2. How Does the Calculator Work?

The calculator uses the credit card payoff formula:

Where:

• \( P \) — Principal balance (current debt amount)
• \( D \) — Monthly payment amount
• \( R \) — Monthly interest rate (APR ÷ 12)
• \( T \) — Time to payoff in months

Explanation: The formula calculates how many months it will take to pay off the balance when making fixed monthly payments, accounting for compound interest.

3. Importance of Calculating Payoff Time

Details: Understanding your debt payoff timeline helps with financial planning, motivates debt reduction, and can reveal when payments are too low to ever pay off the debt.

4. Using the Calculator

Tips: Enter your current balance, planned monthly payment, and APR for each card. Add more cards as needed. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Why does it say "payment too low" for some cards?
A: If your monthly payment doesn't cover the interest charges, your debt will never be paid off.

Q2: How accurate is this calculator?
A: It provides a good estimate but assumes fixed payments and interest rates. Real payments may vary slightly.

Q3: Should I pay off high-interest cards first?
A: Generally yes - the "avalanche method" (paying highest APR first) saves the most money in interest.

Q4: What if I make extra payments?
A: Extra payments will reduce payoff time. Re-calculate with higher payment amounts to see the impact.

Q5: Does this account for minimum payments?
A: No, it uses whatever payment amount you enter. Minimum payments often extend payoff time significantly.