💳 Minimum Payment Credit Card: Calculator

How the Minimum Payment Trap Works

Credit card issuers typically calculate your minimum payment each month as whichever is greater: a fixed percentage of your balance (commonly 1-3%) or a flat dollar floor (commonly $25-$35). This calculator simulates your balance month by month, exactly as a card issuer would apply it — charging interest on the remaining balance, calculating that month's minimum payment, and applying whatever is left after interest to principal — until the balance reaches zero.

Why Minimum Payments Take So Long

Because the minimum payment is calculated as a percentage of your current balance, your required payment shrinks every single month as the balance goes down — even though the interest rate stays the same. Early on, a large share of your payment goes to interest; later, your payment itself becomes very small, so even though a smaller share goes to interest, the tiny payment size means principal reduction crawls forward at a snail's pace. This combination is why paying only the minimum on a high-interest card balance can take well over a decade and often costs more in interest than the original amount charged.

What This Calculator Reveals

Run the numbers with a typical card balance, a double-digit APR, and a 2% minimum, and you'll usually see it takes many years to reach zero, with total interest paid often approaching or exceeding the original balance. If your minimum payment ever fails to cover that month's interest charge, this calculator flags it explicitly — in that scenario your balance would never decrease no matter how long you kept paying only the minimum, which is a critical warning sign of an unsustainable payment structure.

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