How much does credit card interest cost per month?
On $3,000 at 24.99%, interest is $2.05 a day and $61.62 per 30-day cycle. Of the first $100 you pay, $62.48 is interest and $37.52 touches the balance. The APR is the number on the statement; these are the numbers in your account.
The example
One card, one balance, no new purchases. The daily rate is the APR divided by 365. The minimum is the ordinary issuer formula: 1% of the balance plus the month’s interest, floored at $25.
| Balance | APR | Daily rate | Minimum payment |
|---|---|---|---|
| $3,000 | 24.99% | 0.0685% | $92.47 |
What it costs per day, and per payment
Interest first: $2.05 every day you carry the balance, $61.62 across a 30-day cycle. Then what that does to three different payments:
| What you pay | Months to zero | Total interest |
|---|---|---|
| The minimum ($92.47 to start, shrinking) | 185 | $5,113 |
| $100 flat | 48 | $1,756 |
| $150 flat | 27 | $921 |
Read that table twice
The daily number is the one to remember. $2.05 a day does not feel like anything, which is exactly why a $3,000 balance sits there for years. It is $61.62 a month whether you think about it or not.
The second thing the table says is where a payment goes. Pay $100 and $62.48 of it is gone to interest before the balance moves; the balance falls by $37.52. That is why $100 a month takes 48 months, four years, and costs $1,756 on a $3,000 debt.
The minimum is worse than it looks because it shrinks as the balance shrinks. Pay only that and the card takes 185 months, over fifteen years, and $5,113 of interest on $3,000 borrowed. $150 a month instead of $100 cuts the time to 27 months and the interest to $921: the extra $50 saves $835.
The honest recommendation
- Never pay the minimum as a plan. It is a floor the issuer sets so the account stays open, and on this card it costs $5,113 over 185 months. Treat it as the amount that avoids a late fee, nothing more.
- Pick a flat number and keep it flat. The minimum falls every month; a fixed $100 or $150 does not, and that difference is most of the saving. Set the autopay to the number, not to “minimum due”.
- If you can find $50 more, this is where it goes. $50 a month on this balance is worth $835 and 21 months. Few other $50 decisions pay that.
- Do not carry a balance to “build credit”. Paying in full every month reports the same on-time history and costs $0 of interest. The daily charge only starts when a statement balance goes unpaid.
Where these numbers came from
The daily rate is 24.99% divided by 365. The per-day and per-cycle figures multiply that by the $3,000 balance. The payoff rows are simulated month by month: interest accrues on the balance at APR ÷ 12, the payment is applied, and the loop runs until the balance is zero, rounded to the nearest dollar. Change the balance or the rate and every figure moves with it; the shape does not.
Forgenta runs a payoff plan against your real cards and shows the payoff date each payment buys, instead of one number for the whole debt. It also keeps a floor under your checking account, so the payment it suggests is one that clears in a month that has a car insurance bill in it.