Minimum payments keep your account in good standing, but they are a slow way to clear a balance. Here is what it costs.
Updated November 2026
Why minimum payments are slow
The minimum payment is designed to be small. Many issuers set it as about 1 percent of the balance plus that month’s interest, with a dollar floor. Because the payment shrinks as the balance falls, paying only the minimum can take many years. Test your card in the minimum payment calculator. Check your statement for your issuer’s exact formula.
A worked example
Balance $5,000, APR 22 percent, minimum equal to 1 percent of the balance plus interest, with a $25 floor. In month one interest is $91.67 and 1 percent of the balance is $50, so the minimum is $141.67. Each month the balance falls a little, so the payment falls too. Following this month by month, the card is paid off after 230 months, about 19 years and 2 months, and you pay $8,099.77 in interest on top of the $5,000.
Compare with a fixed payment
Paying a flat $200 a month on the same card clears it in 34 months with $1,749.88 of interest. Paying a flat $142 (about the first minimum) keeps the same payment as the balance falls, so it finishes much sooner than the declining minimum does. The lesson: choose a fixed payment at or above your first minimum, not a falling one.
How to model it in Excel
Build a table with these columns: month, starting balance, interest, payment, ending balance. Interest is =B2*0.22/12. The payment is =MIN(MAX(25,B2*0.01+C2),B2+C2). The ending balance is =B2+C2-D2. Copy the row down until the balance reaches zero. See our amortization schedule for Excel for a similar layout.
Better ways to pay
- Set an automatic payment above the minimum.
- Put windfalls such as tax refunds on the card.
- Check whether a lower-rate option makes sense with the balance transfer calculator.
- See the effect of a fixed amount in the credit card interest calculator.
These are illustrations to help you plan, not financial advice.
Frequently asked questions
How is the minimum credit card payment calculated?
Commonly as a percentage of the balance plus interest and fees, or a fixed floor, whichever is larger. Check your statement.
How long does it take to pay off a card with minimum payments?
The $5,000 example at 22 percent takes about 19 years and 2 months.
How much interest will I pay?
About $8,099.77 in the example.
What is the best way to pay faster?
Pay a fixed amount above the first minimum each month.