How to use the payment calculator
Choose what you want to find. Time to pay off takes your current balance, interest rate and monthly payment and tells you how many months it will take to clear the debt, the total interest and the month you will be debt-free. How much I can borrow takes the payment you can afford, the rate and the term, and works out the largest loan that payment supports.
Why the payment must beat the interest
Each month, interest is added to the balance. If your payment is smaller than that interest, the balance never goes down. The calculator warns you when this happens and shows the minimum payment needed to make progress.
The formulas
The number of payments is n = −ln(1 − P × r ÷ M) ÷ ln(1 + r), and the amount you can borrow is P = M × (1 − (1 + r)^−n) ÷ r, where M is the monthly payment and r is the monthly rate.
Paying off debt faster
- Pay more than the minimum on credit cards; minimum payments are designed to keep you in debt for years.
- Use the avalanche method, paying extra on the highest-rate debt first, to save the most interest.
- Consider a lower-rate consolidation loan if you qualify, but avoid extending the term too far.
Frequently asked questions
How long will it take to pay off my credit card?
Enter the balance, the card's APR and your monthly payment. The calculator shows the number of months and the total interest.
How much loan can I get for $500 a month?
Choose How much I can borrow and enter $500, your expected rate and the term. At 7% over 5 years, $500 a month supports about $25,000.