How to pay off a credit card faster: the maths of bigger payments
Because the interest rate is high, every extra dollar you repay saves more than you'd expect.
On a card charging around 21% a year, roughly 1.75% is added every month. The minimum repayment is often set so low that most of it goes on interest, which stretches the debt out for years.
Same $5,000 balance at 20.99%, different payments
Going from $200 to $300 a month cuts 14 months and saves about $670. These figures assume no new spending, and they use monthly interest. Card issuers usually calculate interest daily, so your results will differ slightly.
| Monthly payment | Months to clear | Interest paid (approx.) |
|---|---|---|
| $150 | 51 | $2,570 |
| $200 | 34 | $1,630 |
| $300 | 20 | $960 |
| $500 | 12 | $540 |
Practical steps
Move regular bills to a debit card while you pay the card down.
Set an automatic payment for the amount you've chosen.
Paying the highest-rate debt first (the avalanche method) costs least overall. Paying the smallest balance first (the snowball) can keep you motivated.
A 0% offer only helps if you clear the debt before the revert rate kicks in, and you don't keep spending on the old card.
✨ Key Takeaways
- The payment must exceed the monthly interest, or the debt never shrinks.
- Small increases to the payment save large amounts of interest.
- Free help is available from the National Debt Helpline.
Open the credit card payoff calculator →