What paying your credit card slowly really costs
A credit card bill left to drag is one of the most expensive debts there is. This chart shows the total interest and time to clear one illustrative bill, by how much you pay each month. Free to embed on your own site.
Illustration only, not advice. Credit card interest is about 3 to 3.5% a month (roughly 36 to 42% a year); the exact rate is in your card's terms. The bill and payments are examples. The only way to pay no interest is to clear the full bill by the due date.
This is an illustration at about 3.5% a month, the typical card rate; it is not advice. Your own figures depend on your card's rate and terms. The printed minimum due is about 5% of the balance and shrinks as you pay, so it clears even more slowly than the lowest bar here.
Why a bigger monthly payment helps so much
Interest is charged every month on whatever you still owe. Pay only a little and most of it goes to interest, so the balance barely moves and the interest keeps compounding. Pay more and you cut the balance faster, which cuts next month's interest, and so on. Read the full trap in credit card minimum due and how to escape it in getting out of credit card debt.
Read next
- Credit card minimum due: the trap
- How to get out of credit card debt and the real cost of card EMIs
- Is no-cost EMI really free?
- Browse all GreenFunds data charts
Questions people ask
How much interest does a credit card charge?
Usually about 3 to 3.5% a month, which is roughly 36 to 42% a year. On a 50,000 rupee balance that is close to 1,750 rupees in the first month alone. The exact rate is in your card's statement and terms.
How long does it take to clear a card bill paying only the minimum?
A long time. The printed minimum is only about 5% of the balance, and it shrinks as the balance falls, so it barely dents what you owe while interest keeps running. Paying a fixed, higher amount each month clears the bill far sooner and far cheaper, as the chart shows.
How do I avoid credit card interest completely?
Pay the Total Amount Due, the full bill, by the due date every month. That is the only way to pay zero interest. The moment you carry a balance, you also lose the interest-free period on new purchases.