Credit Card Payoff Calculator

Calculate how long to pay off your credit card debt, compare strategies, and create your debt-free plan.

Total outstanding balance on your credit card
UK average is ~22.9%
Fixed amount each month
Lump sum you can pay now (e.g., bonus, tax refund)

UK Minimum Payment Rules

Most UK credit cards calculate minimum payments as the higher of: 1% of balance + interest + fees, 2.5% of balance, or a fixed minimum (£5-£25).

The minimum you must pay even on low balances

0% Balance Transfer Cards

UK cards offer 12-29 months at 0% interest. Transfer fees are typically 1-3%. Worth it if you can clear the debt within the promotional period.

Avalanche vs Snowball Method

Avalanche: Pay off highest APR first (saves most money). Snowball: Pay off smallest balance first (builds momentum).

Card 1

Card 2

Your total available budget for all credit card payments

The Minimum Payment Trap

Paying only the minimum on a £5,000 balance at 22.9% APR could take over 27 years to pay off and cost you over £7,500 in interest. Always pay more than the minimum whenever possible.

UK Credit Card Debt Statistics 2025

£72.9bn
Total UK credit card debt
22.9%
Average credit card APR
£2,289
Average balance per cardholder

According to the Bank of England and UK Finance, credit card borrowing continues to rise. In 2024, around 30 million UK adults held at least one credit card. Understanding how to efficiently pay off credit card debt is essential for financial wellbeing.

Credit Card Debt by Age Group

Age Group Average Balance % With Debt Avg APR Paid
18-24 £1,120 28% 26.5%
25-34 £2,450 42% 23.8%
35-44 £3,180 48% 22.4%
45-54 £2,890 45% 21.9%
55-64 £2,340 38% 20.8%
65+ £1,560 22% 19.5%
Source: UK Finance, StepChange Debt Charity, Money Advice Service surveys 2024

How Credit Card Interest Works in the UK

UK credit cards charge interest daily based on your APR. The daily rate is APR ÷ 365 (or 366 in leap years). Interest is applied to your average daily balance if you don't pay in full. A purchase APR may differ from a cash advance APR - cash withdrawals often attract higher rates (typically 25-30%) and no interest-free period.

Strategies to Pay Off Credit Card Debt Faster

1. Pay More Than the Minimum

Every pound above the minimum goes directly to your principal balance. Even an extra £20-50 monthly can save years of payments and thousands in interest. For example, on a £3,000 balance at 22.9% APR:

Monthly Payment Time to Clear Total Interest Savings
Minimum (~£75) 15+ years £3,200+ -
£100/month 3 years 4 months £994 £2,206
£150/month 2 years 1 month £586 £2,614
£200/month 1 year 5 months £410 £2,790

2. The Avalanche Method (Mathematically Optimal)

If you have multiple cards, pay the minimum on all but target your highest-APR card with extra payments. Once cleared, move to the next highest. This mathematically saves the most money in interest over time.

Avalanche Method Saves Most Money

Order cards by APR (highest first). Focus extra payments on Card A (29.9% APR) until cleared, then Card B (22.9% APR), then Card C (19.9% APR).

3. The Snowball Method (Psychological Wins)

Pay off your smallest balance first regardless of APR for quick psychological victories. Once that card is clear, roll that entire payment into the next smallest balance. This builds momentum and motivation.

Snowball Method

Order cards by balance (smallest first). Clear £500 card first, then £1,200 card, then £3,000 card. Each cleared debt gives you a "win" and frees up payment money.

4. Consider a 0% Balance Transfer

UK providers offer 12-29 months at 0% interest with transfer fees of 1-3%. If you can clear the debt within the promotional period, you'll save significantly on interest. Be aware of the revert rate (typically 22-25% APR) after the promotional period ends.

5. Make Bi-Weekly Payments

Instead of one monthly payment, pay half every two weeks. This results in 26 half-payments (equivalent to 13 monthly payments) per year, accelerating your payoff by about 8%.

6. Apply Windfalls to Debt

Tax refunds, work bonuses, birthday money, or unexpected income should go directly toward your highest-interest debt. A £500 windfall could knock months off your repayment timeline.

UK Credit Card Regulations (FCA)

The Financial Conduct Authority (FCA) regulates credit cards in the UK. Key protections include:

  • Persistent Debt Rules (2018): Card providers must contact you if you've been in persistent debt (paying more interest than principal) for 18 months, and offer help after 36 months
  • Affordability Checks: Providers must assess your ability to repay before increasing your credit limit
  • Cooling-Off Period: You have 14 days to cancel a new credit agreement without penalty
  • Section 75 Protection: Purchase protection on items £100-£30,000 - the card issuer is jointly liable with the retailer
  • Chargeback: Dispute resolution for card transactions where goods/services weren't delivered

FCA Persistent Debt Warning

If you've paid more in interest and fees than you've repaid in principal over 18 months, your card provider must offer you help. After 36 months of persistent debt, they may reduce or suspend your credit limit and offer a repayment plan.

Frequently Asked Questions

How long will it take to pay off my credit card in the UK?
The time depends on your balance, APR, and monthly payment. At the UK average APR of 22.9%, a £5,000 balance with minimum payments could take 27+ years and cost £7,500+ in interest. With a fixed £200/month payment, you'd clear it in about 2 years 9 months, paying around £1,500 in interest. Use our calculator above to see your exact timeline.
What is a good APR for a credit card in the UK in 2025?
UK credit card APRs typically range from 18% to 30%+ in 2025. Below 20% is considered good. The UK average is approximately 22.9%. Those with excellent credit scores (Experian 800+) may qualify for rates around 13-18%. Rewards cards tend to have higher rates (23-30%). 0% balance transfer cards offer promotional periods of 12-29 months interest-free with transfer fees of 1-3%.
Should I pay off credit cards or save money first?
Generally, prioritise high-interest credit card debt. At 22.9% APR, every £1,000 of debt costs you £229+ yearly in interest - far exceeding typical savings returns of 4-5%. However, keep a small emergency fund (£500-1,000) to avoid taking on new debt when unexpected expenses arise. Once that's secured, focus extra money on clearing your highest-interest cards first.
What's the difference between the avalanche and snowball methods?
The avalanche method targets your highest-APR debt first, mathematically saving the most money in interest. The snowball method targets your smallest balance first, providing quick psychological wins. For example, with three cards at £500/29% APR, £1,500/22% APR, and £3,000/19% APR - avalanche tackles the 29% card first; snowball tackles the £500 card first. Studies show snowball has higher completion rates due to motivation, but avalanche saves more money.
Does paying off credit cards improve my credit score?
Yes, significantly. Credit utilisation (how much of your available credit you're using) is a major factor in UK credit scores. Keeping utilisation below 30% is good; below 10% is excellent. Paying down a £4,000 balance on a £5,000 limit (80% utilisation) to £500 (10% utilisation) can improve your Experian, Equifax, or TransUnion score substantially within 1-2 months.
Should I close credit cards after paying them off?
Usually no. Closing cards reduces your total available credit, increasing your utilisation ratio and potentially lowering your credit score. It also shortens your credit history length. Better approach: keep older cards open with zero balance, using them occasionally for small purchases you pay off immediately. Only close cards with annual fees if you don't use the benefits.
What is a balance transfer card and is it worth getting one?
A balance transfer card lets you move existing credit card debt to a new card with 0% interest for a promotional period (typically 12-29 months in the UK). You'll pay a transfer fee of 1-3% of the amount moved. It's worth it if: (1) you can clear the debt within the 0% period, (2) you won't add new spending to either card, and (3) the transfer fee is less than the interest you'd pay otherwise. Set up a direct debit to clear it before the promotional rate ends.

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Reviewed by: UK Calculator, Founder & Developer

Founder & Developer - UKCalculator.com

The UK Calculator team is the founder and developer of UKCalculator.com, providing free, accurate calculators for UK residents.

Last updated: 14 February 2026