Credit card minimum payments are designed to keep balances revolving. At a 24% APR, a $10,000 balance paid at the 2% minimum takes 30+ years and costs more in interest than the original balance. Worked scenarios at $5K, $10K, $25K — plus an escape plan.
Most issuers use the greater of (a) 1–3% of the statement balance, or (b) a small floor like $25, plus any past-due amounts and fees. Some issuers add the prior period's interest charges on top. The exact formula is in the cardholder agreement under 'minimum payment due.'
Because a 2% minimum on a $10,000 balance is $200, but the same balance at a 24% APR accrues $200 in interest in the first month. You're paying $200 and the balance barely moves. Each month the minimum shrinks as the balance shrinks, extending the payoff timeline to 30+ years.
Since 2010, every credit card statement must include: (a) how long it will take to pay off the balance making only the minimum payment, (b) how much total interest you'll pay, and (c) the monthly payment required to pay it off in 3 years. The disclosure is in the upper-right corner of the statement.
Pay the minimum on every card, then put every extra dollar into the card with the highest APR. When that card is paid off, roll the payment into the next-highest APR card. Mathematically optimal — saves the most interest.
Pay the minimum on every card, then put every extra dollar into the card with the smallest balance. When that card is paid off, roll the payment into the next-smallest. Slightly more expensive than avalanche but the psychological wins build momentum faster.
When (1) you can pay off the entire balance within the introductory 0% APR window (typically 12–21 months), (2) the balance transfer fee (3–5%) is less than the interest you'd otherwise pay during that window, and (3) you stop using the old card. Run the math both ways before opening a new card.
When the personal loan APR is materially below your weighted-average card APR (typically 8+ points lower), the loan term is short enough that you finish paying it off (3–5 years), and you commit to not running balances back up on the cleared cards.
Many issuers offer temporary hardship programs that lower the APR (often to ~9–12%) and waive fees for 6–12 months while you catch up. You typically must contact the issuer before going seriously delinquent. Hardship programs do not appear as derogatories on credit reports if you stay current under the modified terms.
Per the Federal Reserve's G.19 release, the average APR on accounts assessed interest has run in the 21–24% range through 2025–2026. Subprime card APRs run higher (~28–31%); rewards cards skew higher still. Your APR depends on your credit score and the card category.
Yes, on the cards you're paying down. New purchases on a card carrying a balance can lose grace-period protection and start accruing interest immediately. Use one separate low-balance card for everyday spend, pay it in full each month, and freeze the cards you're paying down.
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