Minimum Payment

What does paying the minimum actually cost you?

A minimum payment is designed to keep you paying, not to get you out of debt. Because it shrinks as the balance shrinks, most of your money goes on interest and the balance barely moves. This tool runs the schedule month by month: it tells you how long the minimum really takes, how much of what you hand over is interest rather than the thing you bought, and - on some ordinary cards - that the minimum never clears the balance at all. Then it shows what a fixed payment does instead.

The debt

These two numbers are a worked example - a card carrying a balance at a typical rate. Replace both with the figures on your own statement. The rate especially: this plugin has no rate feed and will not pretend to know yours.

Balance owed What you currently owe on the card or line of credit. The tool assumes you stop adding to it - a balance you keep spending against never clears on any payment, which is a different problem this does not model. Interest rate (APR %) The purchase APR printed on your statement, not a market average. It is charged monthly on the balance, so a couple of points here changes the answer more than most people expect - and above a certain rate the minimum stops clearing the balance entirely.

How the minimum is worked out

Cards state their minimum-payment rule in the cardholder agreement, and there are two common shapes. The default is the one most large issuers use. If yours is different, switch it here - it changes the answer a great deal.

Minimum-payment rule The first shape - this month's interest plus a slice of the balance - always clears the debt eventually, because the balance falls every month. The second - a flat percent of the balance, with a dollar floor - is the older, harsher rule: below a certain payment it barely dents the balance, and if the rate is high enough it never clears at all. Percent of the balance On the first rule this is added to the interest (1% is common). On the second it IS the whole minimum before the floor (2% to 4% is common). Either way it is the number that decides how fast - or whether - the balance falls. Minimum payment floor The smallest the card will ever ask for - often $25 to $35. Once the percentage falls below this, the floor takes over, which is the only thing that eventually clears a flat-percent balance. Set it to zero to see the pure trap.

What you could pay instead

A fixed amount each month The whole point of a fixed payment is that it does NOT shrink as the balance does, so every month more of it goes on the balance. Set it to what you could actually hold to. Leave it at zero to skip the comparison and just see the minimum on its own. A payment below the first month's interest never clears the debt, and the tool will say so rather than pretend.

The free version gives the full answer for your own debt and never clamps it: the payoff time, the interest total, and a comparison against one fixed payment. Pro adds the accelerator grid - what every extra amount a month buys you, from a few dollars up - lets you pin several debts side by side, and adds image and CSV export.
The shareable link is free, for everyone, always. Pro is a separate one-time purchase - if you already subscribe to DCA Simulator Pro, this is not included in it. Worth knowing before you click, rather than at the checkout.

Educational content only - not financial advice. Every figure is in nominal dollars: a debt is repaid in the money of the day, and that is the honest way to show what it costs. The tool assumes the rate holds and you add nothing further to the balance. It does not model promotional rates, changing rates, fees beyond the ones you enter, late charges, balance transfers, or hardship and repayment programs your lender may offer. The minimum-payment rule is the one you select, and real agreements vary - read yours. Run your own numbers.