How do I work out my cc min payment

iammumtoone

I am trying really hard to pay off my credit cards.

How do I work out what my minimum payments will be once I have paid third/half/three quarters off etc.

For example I know what my minimum payment is for £1500 as I am paying it, but I would like to know what the minimum payment will go down to once the debt falls to £750 for example

thanks

[Deleted User]

Your minimum payment should reduce, in the same proportion as the outstanding balance.

Minimum payment is usually a percentage (generally around 2.25% to 2.5% of the outstanding balance), unless the balance is very small, when the minimum payment is about £5, or the whole outstanding balance, if £5 or less.

iammumtoone

Bedsit_Bob wrote: »

Your minimum payment should reduce, in the same proportion as the outstanding balance.

Minimum payment is usually a percentage (generally around 2.25% to 2.5% of the outstanding balance), unless the balance is very small, when the minimum payment is about £5, or the whole outstanding balance, if £5 or less.

Thanks so does that mean the interest added will reduce in the same proportion as well? Therefore if I pay off half the debt the minimum payment will be half of what I pay now?

Sorry if that sounds a silly question and if that is the case I feel a bit stupid but I really have no idea how interest is calculated.

Thanks

[Deleted User]

Yes, interest (assuming you are paying interest) is added monthly, as a percentage of the outstanding balance.

If you want to see how it works, put your CC details through the Snowball Calculator.

http://www.whatsthecost.com/snowball.aspx

By adjusting the amount available for servicing your debt (second data box down), you can see how much faster/slower you can pay it off, and how much interest you can save/lose, by increasing/decreasing your monthly payments.

iammumtoone

Thank you very much

I am now off to stand in the corner wearing a large hat with a 'D' on

Naf

TBH, you shouldn't be worrying about how the min. payment will reduce: keep paying whatever you've managed to cover from the start and you'll be done LOTS faster, and save a massive chunk of interest!

iammumtoone

Naf wrote: »

TBH, you shouldn't be worrying about how the min. payment will reduce: keep paying whatever you've managed to cover from the start and you'll be done LOTS faster, and save a massive chunk of interest!

Yes thanks that is the reason why I want to know how much the payment will reduce by, I am struggling to pay off capital at the moment and want to know when I will get to a stage where it will become easier (as I do plan to keep paying the amount I am now paying - due to the fact I am used to paying this amount). It is just hard to start as the money has to come from 'no where'. Once I start on debt 2 it will clear faster as I will have the whole amount I am paying to debt 1 now coming straight off the capital

I am following the 1% at a time plan and once I get to 50% I will be saving 1% per month just in reduced payments - that info has now given me the motivation I need to try really hard to hit 50%

Naf

iammumtoone wrote: »

Yes thanks that is the reason why I want to know how much the payment will reduce by, I am struggling to pay off capital at the moment and want to know when I will get to a stage where it will become easier (as I do plan to keep paying the amount I am now paying - due to the fact I am used to paying this amount). It is just hard to start as the money has to come from 'no where'. Once I start on debt 2 it will clear faster as I will have the whole amount I am paying to debt 1 now coming straight off the capital

I know the feeling; I hope I didn't come across sounding critical.
I have about £7,500 spread across 4 cards which I'm trying to manage paying down (with variable success).
Call your provider(s); they'll be able to tell you exactly what the monthly terms are. I know that my Barclaycard is 2.25% monthly, while Aqua is 2.53% plus £5 monthly, Capital One is 3.53%, and Vanquis at 4.5%. It can vary quite a lot.
I have a useful app (DebtMinder) which I use to track payments/interest etc.