At a 22% APR, credit card interest costs about $18 a month on $1,000, $55 on $3,000 and $183 on $10,000. If the balance never goes down, that’s $220, $660 and $2,200 a year.
The quick formula
For a rough monthly figure, multiply your balance by the APR and divide by 12. On $3,000 at 22%: $3,000 × 0.22 ÷ 12 = $55.
Most issuers actually charge interest daily on your average daily balance, so the real number moves a little with the length of the billing cycle: about $54.25 in a 30-day cycle and $56.05 in a 31-day one on the same $3,000. Our guide to how credit card interest works walks through the daily method.
Monthly interest by balance and APR
What one month of interest costs if you carry the balance, rounded to the dollar:
| Balance | 18% APR | 22% APR | 25% APR | 29.99% APR |
|---|---|---|---|---|
| $1,000 | $15 | $18 | $21 | $25 |
| $3,000 | $45 | $55 | $63 | $75 |
| $5,000 | $75 | $92 | $104 | $125 |
| $10,000 | $150 | $183 | $208 | $250 |
The jump from 18% to 29.99%, which is close to a typical penalty APR, adds $100 a month on a $10,000 balance. That’s why a late payment can be so expensive; see what happens when you pay late.
What it costs to pay it off in 1, 2 or 3 years
Paying a fixed amount each month at 22% APR, with no new purchases:
| Balance | 12 months | 24 months | 36 months |
|---|---|---|---|
| $1,000 | $94/mo · $123 interest | $52/mo · $245 interest | $38/mo · $375 interest |
| $3,000 | $281/mo · $369 interest | $156/mo · $735 interest | $115/mo · $1,125 interest |
| $10,000 | $936/mo · $1,231 interest | $519/mo · $2,451 interest | $382/mo · $3,749 interest |
Each extra year roughly doubles or triples the interest. On $10,000, clearing it in 12 months instead of 36 saves about $2,500, but it needs $554 more a month. Pick the shortest timeline you can actually keep up.
Why paying only the interest keeps you stuck
If you pay $55 a month on $3,000 at 22%, every dollar goes to interest and the balance stays at $3,000. After a year you’ve paid $660 and owe exactly what you started with. Any payment above the monthly interest is what actually shrinks the debt, which is why the minimum payment takes so long.
Four ways to pay less interest
- Pay more than the interest every month, ideally a fixed amount you set once.
- Pay earlier in the billing cycle. Interest is charged on the average daily balance, so an early payment lowers it.
- Ask for a lower APR. Going from 22% to 18% on $10,000 saves about $33 a month. Here’s a phone script.
- Consider a balance transfer if you can clear the balance during the 0% period.
More questions
How much is 22% APR on $1,000 a month?
About $18.33 a month ($1,000 × 0.22 ÷ 12). With daily interest, it’s around $18 in a 30-day cycle and a little more in a 31-day one.
How do I calculate credit card interest per month?
Multiply the balance by the APR and divide by 12 for a quick estimate. For the exact figure, divide the APR by 365, multiply by your average daily balance and by the days in the cycle.
Do I pay interest if I pay my balance in full?
Usually not on purchases. If you pay the full statement balance by the due date, most cards charge no interest thanks to the grace period. Cash advances are the exception.
Is credit card interest charged monthly or daily?
Most cards calculate it daily and add it to your bill once a month, at the end of the billing cycle.
The bottom line
At 22% APR, every $1,000 you carry costs about $18 a month. Know your number, pay a fixed amount well above it and aim to clear the balance within one to two years. Lowering the APR or moving the balance can cut the cost further.
Sources
- Federal Reserve, G.19 Consumer Credit: interest rates on credit card plans.
- Consumer Financial Protection Bureau: credit cards.
This article is for educational purposes only and is not financial advice. Figures assume a fixed APR, no new purchases and no fees, rounded to the dollar; your issuer’s method may differ slightly.