Credit Card Calculator – Repayment and Interest Calculator
How to calculate credit card fees
Use the credit card interest calculator above to help you calculate the costs of owning a credit card and how much interest you’ll pay.
Our credit card interest calculator will show you how long it will take you to pay off your balance based on what you pay off each month, and how much that will cost you overall, including interest payable.
Simply enter your current balance, APR, and monthly repayments. You can then adjust your monthly repayments to see how paying more or less each month will change your debt.
How does credit card interest work?
Credit card interest is typically billed monthly as a percentage of your balance. Your balance corresponds to the expenses made on the credit card that you have not reimbursed.
Typically, most purchases you make on your card will be interest free for 56 days after purchase, but if you haven’t paid them within that time, the interest charges are backdated. . Some cards also offer specific “0% buy” periods that allow you to pay no interest for longer.
You can avoid paying interest on your balance by paying it off in full and before the end of the month. If you can’t pay it off in full, your balance will accumulate interest charges.
If you fail to make a payment, it is likely that you will be charged interest and penalty fees, and this will show up on your credit report, negatively affecting your credit score.
The more you can repay each month, the less interest you will pay overall. The longer you take to pay off your balance, the more you will end up paying.
Interest is different from the Annual Percentage Rate (APR), which takes into account a number of costs, not only the rate on purchases, balance transfers, but also annual fees, if applicable.
The results of the credit card calculator are representative and do not guarantee the exact interest you will end up paying.
Do I have to make the minimum repayments?
No. In the world of credit cards, one of the worst things you can do if you only make your minimum repayments. Minimum repayments are just that – the bare minimum – and are a sure-fire way to pay too much interest. You could end up paying more interest than on the item you bought with the credit card if you pay the minimum.
Paying off your debt using minimum payments ensures that your debt will last as long as possible, and the credit company will charge you the maximum amount of interest.
How to pay less interest?
There are two main ways to pay less interest: pay more per month or transfer to a balance transfer card.
Increasing your monthly payments will always be good for your credit card debt as it will speed up the speed with which you can pay off your card and thus reduce the overall amount of interest you pay.
Most importantly, it should be based on what you can afford. There’s no point in paying off more of your credit card balance if it leaves you overdraft at the end of the month or if bill payments are missing.
This is when balance transfer cards can come in handy. If your debt is large and you’re struggling to increase your minimum payments, you can transfer the debt for a one-time fee. This then gives you a grace period, during which you can pay off your debt without worrying about interest payments. This grace period can be 12 months or more, which gives you leeway to pay off your debts.
Could a balance transfer card help?
If you are having trouble paying off your balance and are facing large interest payments, you can also apply for a credit card with balance transfer. Balance transfer cards allow you to transfer your current credit card debt to a new credit card provider. You will usually pay a one-time transfer fee, which can range from around 1% to 3% of the amount you transfer.
Once you have transferred the balance, you have a longer period of time to pay it off with 0% interest.
The balance transfer periods vary from six months to three years. The longer the balance transfer period, the more likely you are to need a higher credit score.
Why don’t I continue to transfer my debt using balance transfer cards?
While balance transfer cards can be a great solution, they aren’t a long-term solution for a number of reasons.
First, you cannot transfer a provider’s balance to a balance transfer card issued by the same provider, so your options are limited.
Second, every time you transfer a balance, you will likely be charged a percentage of your balance as a transfer fee.
Most importantly, if you fail to clear the debt within the 0% period, your balance transfer card will revert to a standard interest rate. If you can’t transfer your balance to another provider, you’ll end up paying a lot for your 0% debt.