Credit Card Interest Calculator
Calculate daily, monthly, and annual interest charges on your credit card balance. Understand how interest accumulates and learn strategies to minimize interest costs.
Avoid interest entirely by paying your full statement balance before the due date. This keeps you within the grace period.
Reduce your average daily balance by making payments multiple times during the billing cycle, not just once at the end.
Consider a balance transfer to a card with 0% promotional APR. Calculate if the transfer fee is worth the interest savings.
Credit card interest is the cost of borrowing money on your credit card. When you carry a balance past the grace period, the card issuer charges interest on the unpaid amount.
How It's Calculated: Card issuers typically use the Average Daily Balance method. They track your balance each day of the billing cycle, calculate the average, and apply the daily periodic rate.
Key Formula: Daily Periodic Rate = (APR ÷ 365) × Average Daily Balance = Daily Interest Charge
Interest compounds daily, meaning each day's interest is added to your balance, and tomorrow's interest is calculated on the new, higher balance. This is why carrying a balance can be expensive.
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This Credit Card Interest Calculator provides estimates based on the information you provide. Actual interest charges may vary based on your card issuer's specific calculation method, timing of payments, and other factors. Card issuers may use different methods (Average Daily Balance, Daily Balance, Adjusted Balance) to calculate interest. Always refer to your credit card agreement and statement for the exact interest calculation method and charges. This tool is for educational and planning purposes only and should not be considered financial advice. Consult with a financial advisor for personalized guidance.