Credit card payoff calculator and tips for tackling debt

If you’re dealing with credit card debt, a good place to start is figuring out how much you owe, how much interest you’re paying and how much you can afford to pay each month. Once you have this information, a credit card payoff calculator like the one from Capital One below can provide you with an estimated timeline for getting your debt paid off.

What you’ll learn:

• Using a credit card payoff calculator can help you understand how long it may take to pay off your debt.

• To use the credit card payoff calculator at the end of this article, you’ll need to know your card’s current balance, annual percentage rate (APR) and annual fee.

• With a time frame for paying off the debt, you can estimate the size of your monthly payments. 

• The Consumer Financial Protection Bureau (CFPB) recommends the debt snowball and debt avalanche payoff methods.

A credit card debt payoff calculator can help you understand how long it could take to pay down your debt. Before getting started, there are some helpful terms to know: 

• Credit card balance: Refers to the amount of money you owe on your credit card. Using your current balance accounts for everything you owe. It’s different from your statement balance, which is based on the current billing cycle.

• APR: Refers to the yearly interest on a credit card. Credit cards can have various APRs. For example, purchases may have a different APR from cash advances. And some cards may offer special introductory rates.

• Annual fee: Some credit cards charge an annual fee, which is the amount you’re charged per year for having the card. 

• Minimum monthly payment: The lowest amount you can pay each month to help keep your account in good standing. Paying at least the minimum on time every month can help you avoid penalties and late fees. You can avoid interest on new purchases by paying off your statement balance each month.

If you have more than one credit card account and other debt, there are two strategies the CFPB recommends to help you manage repayments:

• Debt avalanche method: The CFPB refers to this as the “high interest rate method.” It involves identifying debts with the highest interest rate and paying those off first. If you’re using the avalanche method, it’s still important to try and keep up with the minimum payments on your lower-interest-rate debts as well.

• Debt snowball method: Using this method, you make minimum payments on all larger debts while using the rest to knock out the smallest debts. As you eliminate debt, you move to the next smallest. This creates a “snowball of payments,” which gives the method its name. 

As part of using these methods, you might consider consolidating your credit card debt. This could help simplify your payments and lower your interest rate.

Below are some common questions people have about paying off credit card debt:

To take advantage of a debt payoff calculator like the one below, you’ll need to enter your current balance, interest rate or APR and annual fee. You can then enter the monthly credit card payment amount or the time frame in which you’d like to pay off the debt. This calculator works for any issuer—not just Capital One.

Once you have your results, you can explore ways to begin paying down or consolidating your credit card debt. 

If you decide to consolidate your debt, a balance transfer credit card with a low introductory APR might be a good fit. You can check to see if you’re pre-approved with no harm to your credit scores. It’s quick and only requires some basic information.

Keep scrolling to start calculating a debt payoff plan.