How the minimum payment calculator works
How minimum payments are engineered
Most card minimums are the greater of 1â3% of the balance or a floor ($25â35). At 2%, the payment shrinks as the balance shrinks â which is exactly why the debt lingers: your payment falls in lockstep with your debt, stretching a few thousand dollars across a decade of interest.
The fix is boring and powerful
Pick a fixed dollar amount and pay it every month regardless of the shrinking minimum. The payment stays, the balance falls faster, and the interest collapses. Doubling a fixed payment rarely doubles the speed â interest savings compound non-linearly â but every extra dollar shortens the calendar.
If the numbers here shocked you
Good â that is the point. Shock is cheaper when it happens on a calculator than on a statement. Take the fixed-payment result to your budget, trim it to what survives a bad month, and automate it.