One of the most flexible things about having a credit card is the ability to pay the minimum on your balance each month instead of paying the full balance.
How to Calculate Payments
Your credit card agreement will describe how to calculate the minimum payment. It may be different for each credit card you have.
Minimum Payment and Maximum Cost
To see the impact of paying only the minimum on a credit card, assume a credit card balance of $5000, with a current average annual interest rate of 20.28% (as of June 2021), and a minimum payment of 2% of your credit card balance. By paying only the minimum, it will take over 30 years and a total of $23,399 to pay off that initial balance of $5,000. This does not include any fees you may incur over the course of the credit card balance.
Minimum Payment Timeline
Federal law requires that your credit card billing statement include the length of time it will take to pay off your credit card if you only make minimum payments. Check your most recent statement to see the timeline for your credit card based on your current balance and interest rate. You may be surprised by how many years it will take to pay off the balance if you only make minimum payments.
You can also use a credit card repayment calculator to estimate how long it will take to pay off your credit card by making minimum payments. The repayment calculator will also show you how much interest you will pay when you only make minimum payments and allow you to see how increasing payments can help pay off your balance faster.
Source: https://www.thebalancemoney.com/how-long-to-pay-off-balance-with-minimum-payments-961120
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