Why card balances linger
Credit cards charge interest monthly at one twelfth of the APR, and average US card rates have been above 20% in recent years according to Federal Reserve data. On a $5,000 balance at 22%, about $92 of the first month's payment goes to interest alone. Pay $200 a month and it takes about 2 years 10 months to clear, with roughly $1,750 of interest along the way.
Small increases make a large difference because every extra dollar goes straight to principal. The bars show how adding $50 or $100 a month cuts the timeline.
Ways to pay less interest
Stop adding new charges to the card you are paying off, or the balance will keep refilling. Ask your card issuer for a lower rate, which works more often than people expect if you have a good payment history. A 0% balance transfer card can pause interest for 12 to 21 months, but there is usually a 3% to 5% transfer fee; our balance transfer calculator shows whether it pays off. A personal loan at a lower fixed rate is another option for large balances.
Common questions
How long does it take to pay off $5,000 on a credit card?
At 22% APR: about 34 months at $200 a month, 21 months at $300, and 12 months at $500.
How is credit card interest calculated?
Most cards use the average daily balance times the daily rate (APR ÷ 365). A monthly APR ÷ 12 is a close approximation.
Should I pay off my card or save?
Keep a small emergency fund, then pay down high-interest cards. Few savings or investments reliably beat a 20%+ interest rate.
This calculator gives estimates for planning. Real returns, rates and prices change, so treat the result as a guide rather than a promise. Read how we build and check our calculators.