$1,000 Debt at 18.99% APR

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

Minimum payment result
5 yrs 4 mo
paying $25.00/month
Total interest (minimum)
$596.08
paid on top of the $1,000 you borrowed
Fixed 3-year payoff
$36.65/mo
clears the debt in exactly 36 months
Total interest (3-year)
$319.45
total cost to escape this debt in 3 years
$276.63
saved by paying $36.65/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 5 yrs 4 mo $596.08 $1,596.08
Fixed 3-year payoff $36.65 36 months $319.45 $1,319.45
The fix: Commit to $36.65/month — $11.65 more than the minimum. This clears the debt in 3 years and saves $276.63 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 18.99% 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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