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Credit Card Calculator

Created by Tibor Pál, PhD candidate
Reviewed by Dominik Czernia, PhD and Jack Bowater
Last updated: Jun 05, 2023

The credit card calculator is a handy tool for analyzing the repayment of your credit card balance. You can set a specific monthly payment to see how long it will take to repay your credit card balance, but you can also set your desired payback term or desired payoff date to estimate your monthly payment. In each case, you can learn the estimated interest payment.

Besides, you can follow your balance in a dynamic chart and payment schedule table. Read further to get familiar with the credit card debt calculator and see how to choose the best credit card.

Read further and learn what is credit card debt, learn what types of credit card you can get, and what is the best credit cards with the most credit card benefits.

What is credit card? - the credit card definition

A credit card is a type of revolving loan which works differently than installment loans. With an installment loan, for example, mortgage loans, a borrower get a fixed amount of money at a fixed or variable interest rate. The borrower and the lender agree upon the minimum monthly payment in advance, and it remains unchanged over the loan term.

Credit cards follow a different pattern. In general, credit cards have a credit limit, which determines a threshold for the credit balance. The credit card issuer also set a minimum monthly payment on a credit card, which can vary according to the outstanding credit card balance. Finally, there is no specified term on credit cards. A mortgage, for example, typically has a fixed period (for example, 30 years). In contrast, consumers can continue to use the card until the balance doesn't exceed the credit card's credit limit.

Types of credit cards

Since its introduction in 1950, credit cards have become omnipresent in the world. Parallel to the diverse customer need and the financial sector's improvements, multiple types of credit cards appeared in the financial landscape. The following list outlines the most popular credit card types in the US with their specific features.

  • Secured credit cards
  • Unsecured credit cards
  • Student credit cards
  • Business credit cards
  • Reward credit cards
  • Charge cards
  • Subprime credit cards
  • Cash back credit cards

What is a secured credit card?

This type of credit card requires a security deposit to open the account. Accordingly, a secured credit card definition might be stated as a credit card backed by a cash deposit from the cardholder.

How does a secured credit card work?

A secured credit card uses the money you keep in a security deposit account as collateral. When you fail to pay your bill, the lender can compensate by your deposit. This practice assures the lenders about the repayment, even if you have damaged credit or no credit history.

Your income, ability to pay, and your security deposit amount determine your borrowing limit. For example, if you put $2,000 into the deposit account, your available line of credit would be $2,000 if you have sufficient income and demonstrate your ability to pay.

In general, after a specific period (around 6-8 months), if you paid off your monthly balances every month, the bank probably refund your deposit and switch you to an unsecured card.

What is an unsecured credit card

Unsecured credit cards are the traditional credit cards that don't require a refundable deposit to use them. Hence, the unsecured credit card definition can be phrased as the credit card in which debt is not backed by collateral. Therefore, the key difference between secured vs unsecured credit card is the cardholder's range of responsibility for the credit card debt.

Student credit cards

Student credit cards are offered to college students with limited or no credit. Similarly, like student loans, student cards usually have low or no annual fees, which may be coupled with an educational component in the form of rewards. Since students have poor income and credit history, the credit limit on student cards is typically low.

Business credit cards

Business credit cards can be offered to small businesses and corporate. The small business credit card is similar to a personal credit aimed at forming credit for young companies with limited credit history. Businesses with more extended operations and higher credit ratings may meet requirements for gaining corporate cards, which have more beneficial features.

What is a cash back credit card?

Cash back credit card is a type of reward credit card where the issuer aims to build loyalty with cardholders by rewarding them when they use it. The cash back credit cards* offer discounts on purchases. Cash back rewards usually range from 1% to 6% on purchases. When you are about to get a cash back credit card, choose the one that suits your spending habits and the cash back potential compared to the annual or monthly fees.

What is travel credit card?

Travel reward credit cards are also a popular type of reward card. If you travel frequently, you may shop around travel cards to earn mileage or discounts on hotels and travel packages. Some hotels, airlines, and even car rental companies offer reward cards that apply a bonus system. If you are considering getting such a card, always pay attention to how you can earn points!

Charge cards

When someone offers you a charge card, keep in mind that this type of card doesn't allow you to carry a balance into the following month. That is, charge card issuers require your credit to be paid off every month; otherwise, you will be charged a fee. Besides, these cards usually don't have a pre-set spending limit, but the bank can still set limit your credit by, for example, credit history. While this type of card became less popular, it might still be an attractive choice for people who prefer to evade long-term debt.

Subprime credit cards

Subprime credit cards are offered to borrowers who have low credit scores. However, disregarding the poor credit history implies a high price: subprime credit cards usually have high fees and interest rates.

How to choose the best credit card?

When shopping around credit cards, there are several factors to consider to maximize credit card benefits. If you make the right choice, you can substantially reduce the final price you pay for the convenience your credit card provides you. Therefore, paying attention to the below points can help you to choose the best credit card.

  • Interest rate

The most fundamental element that appears in most of the financial products is the interest rate. The lower the rate, the less you pay on an unpaid balance on your credit card debt.

  • Annual Percentage Rate (APR)

While the interest rate is a good starting point, APR reflects better the actual cost of borrowing since it incorporates fees and other expenses as well besides the interest charges. Therefore, the lower the APR, the lower the price you pay for your credit card debt.

  • Card fees and penalties

Multiple types of fees may apply to your card and increase your borrowing cost and APR.

  • Minimum Payment

The minimum payment is the smallest amount of money you agree to pay monthly. While credit cards with lower minimum payments might be attractive, it is worth to keep in mind that the less you pay in a month, the more interest credit card issuer can charge on you. Therefore, it is always advisable to pay more than the required minimum if you are not in an hopeless financial situation. Check our minimum payment calculator to see how credit card companies determine the minimum monthly payments and how your balance and payments proceed if you pay only the monthly minimum.

  • Grace period

The best way to avoid interest charges and penalties is to pay off your credit balance each month. Therefore, the due date, the date by which you need to make the monthly payment is a crucial deadline. The grace period is the term between the end of your billing cycle and the due date. Thus, a longer grace period provides more time for repayment and helps to save money on interest. Try our finance charge calculator to see how grace period affects your monthly cost associated with your credit card.

  • Rewards

As we mentioned before, certain credit cards offer rewards when using their services. The most common type of reward is the card points, but you may also have cashback redemption or miles. Thus, if you travel or have a shopping habit rewarded by a credit card, it might be an excellent choice to acquire such a card.

Note that you can find all these details on your credit card statement.

How to use the credit card debt calculator?

For the first step, you need to choose what you would like to specify in the credit card calculator in line with your interest:

  • monthly payment - define your monthly payment, and you will receive the exact payoff date.
  • desired payoff term - set the chosen term to find out the required monthly payments and the payoff date.
  • desired payoff date - specify your desired payoff date and get the monthly payments required to reach your goal.

Afterwards, in the specification, you need to set the following parameters:

  • unpaid balance - your outstanding credit card debt balance
  • due date - the closest date when you need to make a monthly payment and the charged interest is added to your balance
  • APR - the annual percentage rate or yearly interest rate
  • repayment by - you can set here whether you would like to pay back your credit by fixed monthly or minimum required payments (only available if you choose monthly payment at the beginning)
  • monthly payment - the fixed monthly payment (only available if you choose monthly payment at the beginning)
  • payback within - the desired payback term (only available for desired payoff term)
  • desired payoff date - you can set here the date by which you would like to repay the credit (only available for desired payoff date)

After setting up all the above parameters, you will receive the following results immediately:

  • Repayment details

You can learn here what is your monthly payment, how long does it take to pay off your credit, what is the total payment amount and the charged interest.

  • Balances

You can follow the principal balance (the initial credit to be repaid), the interest, and principal amount you paid through the repayment term.

  • Payment schedule

The payment schedule shows you the opening and closing balances in each month together with the monthly payments, and it's principal and interest parts.

In the advance mode you can set the parameters for the minimum monthly payment requirements and its calculation method applied by a credit card issuer.


The results of the credit card calculator should be considered as a model for financial approximation. All payment figures, balances, and interest figures are estimates based on the data you provided in the specifications that are, despite our best effort, not exhaustive.

For this reason, and also mostly because of the multiple interest rates applied on fluctuating daily balances, the calculator is created for instructional purposes only. Yet, in case you experience a relevant drawback or encounter any inaccuracy, we are always pleased to receive useful feedback and advice.

Tibor Pál, PhD candidate
I would like to specify the..
monthly payment
Unpaid balance
Due date
Repayment by
fixed payments
Monthly payment
Repayment details
Your monthly payment is $100, and you will pay off the credit in 11 month(s), on Apr. 24, 2025,
The total payment amount is $1,092.36, with an interest payment of $92.36.
Chart of balances
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