How long does it take to pay-off a credit card when you only make minimum payments and do not add any new charges? The applet below answers that question. The numbers that are initially in this applet are from "Credit card debt has its price," Los Angeles Times, Jan. 30, 2008, p. C1.
The minimum payment in the following applet starts with 4% of the current amount owed. This value is rounded up to the nearest dollar and increased, if necessary, so that it is at least $10.
The finance charge is the current amount owed times the monthly interest. It is rounded to the nearest penny and increased, if necessary, so that it is at least 50 cents.
The results of this applet are more optimistic than those in the above article. That article states that it would take about 35 years to pay-off $9,500 when the interest rate is 13.74%. Instead, this applet finds that it would take 12 years and 9 months. In any event, it would take a long time to pay-off a debt when one just pays the minimum amount.
File Jockey at Compu Serve dot com
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Last updated: 6-Feb-2008