Paying off Your Credit Card Balance

If you have already made good progress in paying off your credit card balance during the discounted balance transfer period, then you should be able to work out how many more months it will take to clear the full balance. If, say, you have transferred a balance of £2,000 and have managed to repay a total of £600 in six months, on average you have been reducing the balance by £100 a month. As you will now be charged interest on the balance, you will either need to increase your monthly payments to cover this interest, or recalculate how much of your repayments will go on interest.

Continuing the example, if you have £1400 outstanding and the regular credit card interest rate is 18.9% APR, this will work out as 1.45% per month. You will therefore need to pay an additional £20.30 on your first payment to keep reduce the balance by £100, an additional £18.85 in the second month to get the balance down to £1200 and so on. It would then take 14 months to pay off the balance in full. If you keep your payments at £100 per month, it would take an additional one month to repay the balance, due to the extra interest accrued.

If you are able to repay the balance in this manner, then the interest rate that you pay will become much less of a consideration. This is because the balance has already been reduced in the 0% period, and if you continue to make the repayments, the interest period should only last a number of months, not over a number of years.