Credit Card Payoff Calculator
Plan your strategy to become debt-free faster.
Card Details
Payoff Summary
You will be debt-free in
-
Total Principal Paid
₹0
Total Interest Paid
₹0
How Credit Card Debt is Calculated
Credit card debt can accumulate quickly due to high interest rates (APR) and compounding. Each month, your payment first covers the interest accrued on the balance, and only the remaining amount reduces your principal. This calculator determines how many months it will take to clear the balance with your chosen monthly payment.
The Payoff Formula (NPER)
The calculation uses a financial formula known as NPER (Number of Periods) to determine the time to pay off a loan:
n = -log(1 - (P * r) / R) / log(1 + r)
Where:
- n is the number of months.
- P is the principal balance.
- r is the monthly interest rate (APR / 12).
- R is your monthly payment.
Important Note
If your monthly payment is less than or equal to the monthly interest, you will never pay off the debt. This is known as a debt trap, and our calculator will alert you if this is the case.
Strategies to Pay Off Debt Faster
- Pay More Than the Minimum: Always try to pay more than the minimum required payment. This ensures more of your payment goes towards the principal.
- Use the Debt Snowball or Avalanche Method: Focus on paying off the smallest balance first (snowball) or the highest-interest balance first (avalanche).
- Consider a Balance Transfer: Move your debt to a card with a 0% introductory APR to temporarily halt interest accumulation while you pay down the principal.
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