This credit card interest calculator provides a comprehensive breakdown of your monthly payments. It calculates the portion of each payment that goes towards the principal balance and the portion that covers interest. Additionally, it estimates the number of months required to fully pay off your credit card balance, assuming no new charges are made during this period. The calculator also reveals the total interest cost you will incur by the time the balance is paid off, giving you a clear picture of the long-term financial impact of your credit card debt.

## Credit card interest can seem a bit complex, but it basically revolves around a few key concepts:

**Annual Percentage Rate (APR)**: This is the annual interest rate you’ll be charged if you carry a balance on your credit card. It’s expressed as a percentage and can be fixed or variable.

**Daily Periodic Rate (DPR)**: Interest is usually calculated on a daily basis. To find the DPR, the APR is divided by 365 days.

**Average Daily Balance**: This is the average amount you owe each day during a billing cycle. Your balance is summed up each day, and then divided by the number of days in the billing cycle to get this average.

**Interest Calculation**: To find out how much interest you’ll be charged, multiply your Average Daily Balance by the Daily Periodic Rate and then multiply by the number of days in the billing cycle.

**Compounding**: Interest is often compounded, meaning that you pay interest on both the principal amount and any previously accumulated interest. This can lead to interest charges growing faster if you don’t pay off your balance.

**Grace Period**: Many credit cards offer a grace period, which is a time frame where you can pay off your balance in full without accruing interest. This period typically lasts from the end of the billing cycle to the due date.

**Minimum Payments**: If you only make the minimum payment, the remaining balance will accrue interest, often at a higher rate. This can lead to paying significantly more over time.