ClearCalc

How Credit Card Interest Adds Up

Credit card interest is calculated daily based on your balance and APR (Annual Percentage Rate). If you carry a balance from month to month, interest charges can grow rapidly — making it harder to pay off your debt.

Our calculator helps you see how long it will take to pay off your balance, and how much interest you’ll pay based on your current monthly payment.

Example:

• Balance: $5,000
• APR: 22%
• Monthly Payment: $150

At that rate, it would take over 5 years to pay off — and you’d pay thousands in interest. By increasing your monthly payment even slightly, you can dramatically reduce both time and interest.

Tip:

Try adjusting your monthly payment in the calculator to see how even a small change affects your total interest. You’ll quickly see the power of paying more than the minimum.

Understanding the Cost of Credit Card Debt

The average American carries several thousand dollars in credit card debt — and many don’t realize just how much of their payment goes toward interest. When your APR is high, your monthly payments may barely touch the principal.

This is why credit card companies love minimum payments: they keep you in debt longer, collecting interest. But the good news is that every extra dollar you pay above the minimum goes entirely toward reducing your balance.

ClearCalc helps you visualize the long-term impact of your decisions — whether it’s boosting your monthly payment, refinancing to a lower interest card, or just committing to a payoff plan.

Knowledge is power. Play around with the numbers and find a plan that works for you.