Finding the time necessary until you pay off a loan

Finding the time necessary until you pay off a loan is simple if you make equal payments each month. However, when paying off credit cards many individuals only make the minimum monthly payment, which is generally 2% to 3% of the balance or $10 whichever is greater. Locate the credit card calculator at www.fincalc.com and work out this exercise:

You currently owe $10,000 on a credit card with a 17% interest rate and a minimum payment of $10 or 2% of your balance.

– How soon will you pay off this debt if you make the minimum payment each month?

– How much total interest will you pay using that method?

– Calculate how soon you would pay off this debt if you paid $100 per monthly payment.