$5,000 Debt at 20.99% APR

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

Minimum payment result
10 yrs
paying $100.00/month
Total interest (minimum)
$6,972.84
paid on top of the $5,000 you borrowed
Fixed 3-year payoff
$188.35/mo
clears the debt in exactly 36 months
Total interest (3-year)
$1,780.58
total cost to escape this debt in 3 years
$5,192.26
saved by paying $188.35/month instead of $100.00/month

Payoff Strategy Comparison

Strategy Monthly Payment Time to Pay Off Total Interest Total Paid
Minimum payments only $100.00 10 yrs $6,972.84 $11,972.84
Fixed 3-year payoff $188.35 36 months $1,780.58 $6,780.58
The fix: Commit to $188.35/month — $88.35 more than the minimum. This clears the debt in 3 years and saves $5,192.26 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 $5,000 at 20.99% APR, the minimum is $100.00/month. While this keeps you current with the lender, most of each payment goes to interest — not principal.

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