How does my credit card interest rate affect how long it will take to pay off my card?

Your credit card interest rate has a significant impact on your repayment timeline. The higher your interest rate, the more you'll pay in interest charges over time, making the period you’re paying off your cards longer. Lowering your interest rate through debt consolidation or negotiation helps you save money and become debt-free faster.

How can I negotiate lower interest rates on my credit cards?

To negotiate a lower interest rate, simply call your credit card issuer and ask for one. Highlight your history or improvement in on-time payments, and be polite but persistent. Success isn’t guaranteed, but asking can’t hurt.

How much do I need to pay off my credit card each month?

Sometimes, you might have to stray from your budget or make a smaller monthly contribution than you’d hoped. That happens. But you should do your best to pay at least the minimum payment each month to avoid paying additional late fees and further hurting your credit score.

How can EarnIn help my debt payoff journey?

If you’re in a pinch and need access to cash quickly, EarnIn has your back. The Cash Out tool lets you access the money you’ve already earned before payday, saving you from charging more to your credit card or needing a cash advance. Having this tool prevents you from accumulating even more debt by giving you access to your wages when you need them.

How long will it take for my credit score to improve after paying off my credit card debt?

The timeline for your credit score to improve after paying off debt depends on your credit profile — but you may see positive changes in your credit score within a few months of making consistent, on-time payments. Maintaining healthy credit habits is the key to long-term credit score growth. This does depend on whether or not you’re incurring new debt while making payments toward your existing balance. If your debt continues to grow or isn’t shrinking at a steady rate, it might take longer to improve.

Credit Card Payoff Calculator | Get debt-free faster

How to use EarnIn’s Credit Card Payoff Calculator

The Credit Card Payoff Calculator is an easy-to-use tool designed to help you understand your debt repayment journey and create a personalized plan to get your balance to zero. To use it, you’ll just need some basic info about your card and how you use it:

Balance. Enter the total amount you owe.
Interest rate. Input or calculate the annual percentage rate (APR) for your card. That rate is the percentage you pay each year to borrow money from your credit card company. You can find your APR on your monthly credit card statement or your card agreement.
Ongoing monthly spend. If you plan to continue using the card while paying it off, enter your expected average monthly spend here.

Next, you’ll choose one of two options:

Expected monthly payment. If you have a specific monthly payment in mind or plan to pay the minimum required by your credit card company, enter that amount here. We’ll then calculate how long it takes to pay off your credit card.
Desired months to pay off. Enter your desired timeframe to become debt-free in months. If you’re aiming for three years, that’s 36 months. We’ll calculate the monthly payment you need to make to achieve this goal.

Once you’ve entered your info, click the button to see your results. You’ll see your expected monthly payment and estimated debt-free date, calculated based on your card’s details.

How to pay off credit card debt: Effective strategies

Once you know how long it will take to pay off your credit card and what your monthly payments should be, you simply need a plan to follow.

Here are some of the most popular strategies for paying off your credit card balances:

Snowball method

If you have multiple credit cards accumulating interest, the question is which to pay off first. With the snowball method, you start by paying off your smallest balance while making minimum payments on your other cards. Each time you pay off one card, you switch focus to your next smallest debt.

The biggest benefit of the snowball approach is the psychological boost you get from quickly paying off smaller debts. This sense of accomplishment keeps you motivated and committed to your debt repayment plan.

Avalanche method

The debt avalanche approach prioritizes paying off cards with the highest interest rates first. After paying off each card, move on to the card with the next highest rate until they’re all paid off.

By attacking high-interest debt, you minimize the overall interest paid during your debt repayment journey.

The debt avalanche method may not provide the same immediate gratification as the debt snowball approach, but it can save you money in the long run and is one of the best tips for paying off debt.

Balance transfer credit cards

Balance transfer cards let you transfer the balances from all your credit cards onto a single card. Many balance transfer cards offer introductory 0% APR promotions, enabling you to transfer high-interest balances and pay them off interest-free for a set period. Some companies also allow you to negotiate a lower long-term interest rate.

Moving your balances to one card might mean saving on interest charges and simplifying your repayment plan by combining multiple debts into one monthly payment. This is called consolidation. But watch out for any transfer fees which could impact whether a balance transfer is right for you.

Personal loans

Another way to consolidate credit card debt is to take out a personal loan to pay off your balances. These loans often have lower interest rates than credit cards, giving you more flexibility in how long you take to pay that sum off. But longer repayment terms also mean more interest payments over time, so if you take out a personal loan to cover your credit card debt, you should still try to pay it off as quickly as possible and maximize your payments during any low-interest introductory period. Getting a good rate for a personal loan is usually contingent on your credit score, so this option is best for those with strong credit. If your credit score is too low, you might have high interest rates or upfront fees that aren’t worth the loan in the first place.

Tips for a debt-free future

Once you’ve seen your path to becoming debt-free on EarnIn’s Credit Card Payoff Calculator and devised a strong debt repayment strategy, follow these tips to make sure you stay on track:

Avoid new debt. Spending responsibly and paying credit card bills within the grace period are great ways to avoid new debt. Consider setting aside your credit cards and using no interest apps like EarnIn or cash and debit cards to avoid taking on more debt.
Interest rate. Input or calculate the annual percentage rate (APR) for your card. That rate is the percentage you pay each year to borrow money from your credit card company. You can find your APR on your monthly credit card statement or your card agreement.
Use an earned wage access app. If you find yourself needing access to cash, EarnIn’s Cash Out tool lets you access your pay early, up to $150 a day and up to $750 every pay period, so you can avoid charging unexpected purchases to credit cards that can rack up more debt.
Hone your budget. Stick to a budget that aligns with your income and expenses. Make savings and outstanding debt payments a top priority while tracking your expenses and reviewing your budget often to make sure you’re sticking to the plan and adjusting as needed.
Build a rainy-day fund. Setting aside money for 3-6 months of living expenses helps you avoid turning to credit cards for unexpected bills. EarnIn’s Tip Yourself tool can help you set aside that money in different Tip Jars (up to $2000 across 5 jars) as a reward for yourself or to save for rainy days.³
Avoid overdraft fees: Overdrafting on your bank account gets expensive and puts you further behind. To help avoid low bank balances, use EarnIn’s Balance Shield to get $150 automatically when your account dips below a threshold you set, saving you big on costly overdraft fees.⁴
Set financial goals. Set specific, achievable financial goals like a vacation or a security deposit for a better home. Having these clear goals will help you focus on maintaining financial stability

Approaching your financial plan with these tips can help change your relationship with your debt and build a stronger foundation for long-term success.

Understanding what affects your credit score

High credit card usage can hurt your credit score because it suggests to lenders that you rely too heavily on debt.

Your credit card usage impacts a metric called the credit utilization ratio. This ratio is a percentage that indicates the amount of available credit you’re actually using.

Your credit utilization ratio decreases as you pay down your credit card balances, which can boost your credit score. A good rule of thumb is to try to keep your credit usage below 30%. And it’s essential to avoid going over your credit limit as this can hurt your credit score and lead to extra fees.

Late or missed payments can also damage your credit and lead to interest charges that cause your debt to spiral out of control, so make timely payments a priority.

Credit card payoff calculator