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Credit Card Minimum Payment Calculator

Visualize the debt trap of minimum payments. Compare payoff times and interest costs between minimums and fixed monthly payments.

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Category Loans & Credits

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See the effect of paying a fixed amount instead of the declining minimum.

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About

Paying only the minimum on a credit card is designed to keep borrowers in debt for decades. This tool exposes the mechanics of revolving debt. Credit card issuers typically calculate the minimum payment as a small percentage of the total balance plus accrued interest. As the balance decreases so does the payment amount slowing down the principal reduction to a crawl.

The mathematical consequence is that the final few hundred dollars of debt can take years to clear. This calculator generates two trajectories: the Minimum Payment path and a Fixed Payment Goal path. Users can visualize how adding a small fixed amount to their monthly contribution drastically reduces the Time to Payoff and saves thousands in Total Interest. This is essential for anyone strategizing to become debt-free.

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Formulas

The minimum payment is a dynamic value calculated every month. It generally follows this logic:

MinPay = max(Floor, Balance × % + Interest)

Because the payment drops as the balance drops the curve flattens. The standard amortization formula does not apply here. We must simulate the payoff iteratively month by month.

Reference Data

VariableSymbolTypical Value
BalanceBCurrent Debt
Annual RateAPR15% to 29%
Daily RateDPRAPR ÷ 365
Min Pay FloorFloor$25 to $35
Min Pay RateRatemin1% to 3%
Interest ChargeIB × DPR × 30
Principal PayPPayment − I
Payoff TimeTCan exceed 20 years

Frequently Asked Questions

Because the minimum payment is often calculated as a percentage of your balance. As your balance goes down your payment goes down. This means you pay less toward the principal every month dragging out the loan term indefinitely.
The floor is the absolute minimum amount the bank will accept regardless of the percentage calculation. Usually $25 or $35. Once your calculated payment drops below this you pay the floor amount until the balance is zero.
Even a small increase makes a huge difference. Doubling the minimum payment often reduces the payoff time by more than half and cuts total interest paid by 60-70%.
Yes most issuers compound interest daily. This means yesterday's interest is added to your balance today and today's interest is calculated on that new total.