$1,000 Debt at 15.99% APR

Here is exactly what minimum payments cost you — and a clear path out.

Minimum payment result
4 yrs 10 mo
paying $25.00/month
Total interest (minimum)
$438.10
paid on top of the $1,000 you borrowed
Fixed 3-year payoff
$35.15/mo
clears the debt in exactly 36 months
Total interest (3-year)
$265.50
total cost to escape this debt in 3 years
$172.60
saved by paying $35.15/month instead of $25.00/month

Payoff Strategy Comparison

Strategy Monthly Payment Time to Pay Off Total Interest Total Paid
Minimum payments only $25.00 4 yrs 10 mo $438.10 $1,438.10
Fixed 3-year payoff $35.15 36 months $265.50 $1,265.50
The fix: Commit to $35.15/month — $10.15 more than the minimum. This clears the debt in 3 years and saves $172.60 in interest.

How Minimum Payments Are Calculated

Credit card issuers typically set the minimum at the greater of $25 or 2% of the outstanding balance. For $1,000 at 15.99% APR, the minimum is $25.00/month. While this keeps you current with the lender, most of each payment goes to interest — not principal.

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