If you had £5,000 outstanding on a credit card, with an interest rate of 19.9%, your minimum repayment would be £132.92.
If you don’t spend any more on the card, your minimum repayments would go down every month.
However, after three years, your outstanding balance would still be £1,895.51 and you would have paid £1,936.66 in interest.
At this rate, it would take you 18 years and 10 months to pay of the total balance – and you would have repaid £12,277.84 in total.
If you increased your repayment to £200 every month instead, your £5,000 credit card balance would be paid off in just 2 years and 9 months. You’d pay back £6,511.27 in total, saving you £5,766.57 in interest.
In the table below, we compare what happens if you repay different amounts – £150, £175 and £200 – every month.
These examples assume the original amount owed was £5,000 and you don’t spend any more on the card while you’re making repayments.