Bank card curiosity calculator – MoneySense

Fill out the stability and rate of interest prompts, choose the way you need to calculate the debt curiosity (by month-to-month cost of variety of months), and at last the time or cost prompts. The curiosity owed will routinely seem. For more information, maintain studying under the calculator.

The best way to use the bank card curiosity calculator

Right here’s what every a part of the calculator means:

• Present bank card stability: How a lot you at the moment owe in your bank card.
• Rate of interest: The annual proportion charge (APR) charged by your bank card, usually 12% to twenty%.
• Calculate your curiosity: You may calculate the quantity of curiosity both by your month-to-month cost or by quite a few months. For the primary choice, enter the quantity of the cost subsequent to “Month-to-month cost.” Or click on the second choice and enter the variety of months subsequent to “Desired time to repay stability.”

How is bank card curiosity calculated?

In case you don’t repay your full stability earlier than the cost due date proven in your bank card assertion every month, you’ll pay curiosity on what you owe. Each bank card has an annual proportion charge (APR), starting from 12% to round 20% (generally much more) for purchases. The APR is an annual charge, however bank card curiosity is calculated day by day and charged month-to-month.

To seek out out the day by day rate of interest, divide the APR by 365 (variety of days in a 12 months). For instance, for a card with an APR of 20%, the day by day charge is 0.0548%. To calculate month-to-month curiosity costs, bank card multiply a cardholder’s common day by day stability throughout every billing cycle (a set interval of 28 to 31 days) by the day by day charge.

Let’s say you’re carrying a stability of $1,000 on a card with a 20% APR. At a day by day rate of interest of 0.0548%, the day by day cost can be about $0.55. Multiply that by the variety of days within the billing cycle to see your month-to-month curiosity. For 30 days, the curiosity would add as much as $16.50.

Be aware that bank card suppliers cost larger rates of interest for money advances (borrowing money from a bank card) and cash-like transactions, with APRs starting from 23% to twenty-eight%. Plus, curiosity begins accumulating from the date you are taking out the money—there’s no grace interval, just like the one you get when making purchases in your card (usually 21 days from the date your bank card assertion is issued). Borrowing money with a bank card may be very costly, so restrict it to emergencies solely.

The best way to keep away from paying bank card curiosity

The easiest way to keep away from paying bank card curiosity is to repay not simply the “minimal cost” proven in your bank card assertion, however the full quantity you borrowed, on time, each month. Sure, each month. In case you can’t, make no less than the minimal cost by the due date, to keep away from late charges and any dings in your credit score historical past. The minimal cost is both a flat charge (for instance, $10) or a proportion of your excellent stability (usually 3%), whichever is larger. (Be aware: In Quebec, the bank card minimal cost is 4.5%. As of Aug. 1, 2025, it will likely be 5%.)

In case you don’t make the minimal cost by the due date, you’ll be charged a late price starting from $25 to $40, which can seem in your subsequent assertion. In case you’re repeatedly late or cease making funds, you additionally threat harming your credit score rating, which might make it tougher so that you can get reasonably priced credit score sooner or later. Your bank card supplier can also increase your rate of interest. In case you’re receiving a promotional rate of interest, chances are you’ll lose it and need to pay the common APR. Finally, the cardboard supplier might even cancel your bank card and switch your debt to a debt assortment company.

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The best way to scale back bank card debt

In case you carry a stability, these 5 methods might help you pay much less curiosity on bank card debt.