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Credit Card Calculator

See exactly how long it takes to clear your balance — and how much interest you'll pay. Discover the true cost of making only minimum payments, and how small extra payments make a big difference.

CREDIT CARD CALCULATOR

£
%
£
Must be more than the monthly interest charge to make progress.

Step-by-step solution

Year-by-year balance

Year Opening balance Interest paid Principal paid Closing balance

Credit Card Calculator Explained

Core concepts, classroom applications, and plain-English explanations for all audiences.

When would you actually use this?

The moment you get your first credit card. A £2,000 balance at 22.9% APR — if you only pay the minimum each month — can take over 25 years to clear and cost you more in interest than the original debt. This calculator shows you the real numbers before you're in too deep.

Worked example

"£2,000 at 22.9% APR, paying £50/month minimum. How much do you really pay?"

Monthly rate: 22.9% ÷ 12 = 1.908%

Month 1 interest: £2,000 × 1.908% = £38.17

Month 1 repayment: £50 − £38.17 = £11.83 off the debt

Result: ~10 years to clear, ~£3,900 total paid

Pay £150/month instead and it's clear in 16 months — saving nearly £1,700.

Key terms explained

  • → APR (Annual Percentage Rate): The yearly interest cost, including fees — lets you compare any two credit products fairly
  • → Minimum payment: Usually 1–3% of the balance — designed to keep you paying interest as long as possible
  • → Balance transfer: Moving debt to a 0% card — often saves thousands, but watch for the transfer fee (typically 2–3%)

The minimum payment trap

Minimum payments feel affordable because they're designed to. Each month you pay mostly interest and barely reduce the debt — compound interest working against you. Always pay more than the minimum.

Good to know

Credit cards and interest

Minimum payment trap
Minimum payments keep you in debt for years
Credit card minimum payments are typically around 1–2% of the balance. Because the minimum falls as the balance falls, you're always paying roughly the same portion — most of which is interest. A £2,000 balance paid at minimum only could take over 20 years to clear.
£2,000 at 22.9% minimum (2%):
Month 1 minimum: ~£38
Interest: ~£38 — barely moving
Years to clear: 20+ years
A fixed payment clears debt far faster
Setting a fixed monthly payment instead of paying the minimum is far more effective. As the balance falls, more of each payment goes to principal (because less is owed in interest), so the debt shrinks faster and faster — the reverse of the compound interest snowball.
£2,000 at 22.9%, paying £80/month:
Clear in 31 months (2.6 years)
Total interest: £441
vs minimum: 20+ years, £2,000+ interest
How monthly interest is calculated
APR stands for Annual Percentage Rate. To find your monthly interest charge, divide the APR by 12 (converting to a decimal first). Each month, that rate is applied to your outstanding balance — which is why carrying a balance month to month costs significantly more than a once-off purchase.
APR 22.9% ÷ 12 = 1.908% per month
Balance £2,000:
Month 1 interest: £2,000 × 0.01908 = £38.17
0% balance transfer cards
A 0% balance transfer card lets you move your existing debt to a new card with no interest for an introductory period (typically 12–24 months). You pay a transfer fee (usually 2–3%) but then every payment goes directly to reducing the principal. This can save hundreds in interest.
£2,000 transfer at 3% fee: £60
0% for 18 months
Pay £111/month = cleared in 18 months
Interest saved vs 22.9%: ~£350