Credit Card Interest Calculator

Related Calculators

Table of contents

• How to use
• Common mistakes
• Definitions
• Methodology
• Limitations & assumptions
• Sources

APR (percent): The annual percentage rate. It is the yearly interest rate for the card, not the monthly rate.

Average daily balance ($): The average balance across the billing cycle. Credit card interest estimates often use this balance because purchases, payments, and credits can happen on different days.

Billing cycle length (days): The number of days in the statement period used for the one-month interest estimate.

Daily interest rate: APR divided by Days in interest year. The calculator shows it as a percent per day.

Current balance ($): The card balance the payoff plan starts from, before any Extra payment now ($).

First payment that lowers the balance: The part of the first regular payment left after First month interest is covered.

Total paid: The payoff starting balance plus Total interest paid. It does not include Extra payment now ($).

Mistake: Entering a monthly interest rate in APR (percent).
Fix: Enter the yearly card rate in APR (percent), such as 24.99 for 24.99% APR.

Mistake: Using Current balance ($) as Average daily balance ($) when the balance changed a lot during the cycle.
Fix: Use the Average daily balance ($) from your statement, or estimate the average of your daily balances.

Mistake: Including future purchases in Current balance ($).
Fix: Use the balance you want the payoff plan to pay down, before new spending.

Mistake: Putting the minimum due in Monthly payment ($) when you plan to pay more.
Fix: Enter the regular amount you actually expect to pay each month in Monthly payment ($).

Mistake: Leaving Billing cycle length (days) at 30 when your statement has a different cycle length.
Fix: Use the day count shown on your statement if you are checking a real Estimated interest charge.

Mistake: Adding Extra payment now ($) and also subtracting it from Current balance ($).
Fix: Either lower Current balance ($) yourself or enter the extra amount in Extra payment now ($), but do not do both.

• This is an estimate. Your issuer's exact method can differ by purchase APR, cash advance APR, fees, timing rules, grace period status, and rounding.
• The one-month interest mode uses Average daily balance ($), APR (percent), Billing cycle length (days), and Days in interest year. It does not rebuild every daily transaction.
• The payoff plan assumes no new purchases, no fees, no rate changes, and the same Monthly payment ($) each month until the final smaller payment.
• The payoff plan adds interest before each regular monthly payment, using Daily interest rate times Average month length for payoff (days). It does not compound inside the month.
• If Monthly payment ($) is too small to cover the first month's interest when APR is above 0, the calculator should not give a payoff month because the balance would not go down.
• Paying the full statement balance by the due date may avoid purchase interest when a grace period applies, so a real bill can be lower than this estimate.

Daily rate

The calculator first turns APR into a daily rate. APR is entered as a percent, so it is divided by 100 before the daily-rate step.

daily_rate = (apr_percent / 100) / days_per_year

The displayed Daily interest rate is daily_rate * 100, shown as percent per day.

One-month interest

For One-month interest, the calculator multiplies Average daily balance ($) by the daily rate and the number of days in the billing cycle.

interest_charge = average_daily_balance * daily_rate * billing_cycle_days

Mini-example:

with Average daily balance ($) of 1,000, APR (percent) of 24, Billing cycle length (days) of 30, and 365 Days in interest year, the daily rate is 0.24 / 365 = 0.000657534. The estimated interest charge is 1000 * 0.000657534 * 30 = $19.73.

Payoff plan

The payoff plan starts by subtracting Extra payment now ($) from Current balance ($). If that result is zero or less, the payoff is immediate and interest is $0.

payoff_start_balance = current_balance - one_time_payment_now

Then the calculator converts the daily rate to a simple monthly estimate using Average month length for payoff (days).

monthly_rate = daily_rate * average_days_per_month

Each month, interest is added first. Then the regular Monthly payment ($) is applied. The final payment can be smaller than the planned payment.

interest_m = balance_m * monthly_rate

amount_due_m = balance_m + interest_m

payment_m = min(monthly_payment, amount_due_m)

balance_next = amount_due_m - payment_m

total_interest = total_interest + interest_m

Total paid is the payoff starting balance plus the interest found in the loop.

total_paid = payoff_start_balance + total_interest

Mini-example: with Current balance ($) of 5,000, APR (percent) of 24, Monthly payment ($) of 250, no Extra payment now ($), 365 Days in interest year, and 30.4375 Average month length for payoff (days), the first month interest is $100.07. The first payment lowers the balance by $149.93, and the loop pays off the balance in 26 months with about $1,450.75 in total interest.