Roll Down Credit Card Debt Calculator

How the Roll Down Method Works

When you use the roll down method to pay off credit card debt, you make only the minimum required payments each month. This means you're essentially "rolling down" your debt payments over time while interest continues to accrue. Here's how it works:

Key Concepts

• Minimum Payment: The smallest amount you must pay each month to keep your account in good standing
• Interest Accrual: The interest charges that accumulate on your balance each month
• Debt Growth: How your total debt increases over time due to interest

The Roll Down Process

1. Calculate your minimum monthly payment based on your current balance and interest rate
2. Make this payment each month, keeping your account current
3. Watch as interest continues to accrue on your remaining balance
4. Continue making minimum payments until your balance is paid off

The key advantage of the roll down method is that it keeps your account in good standing, which can help maintain your credit score. However, it typically takes much longer to pay off your debt compared to other methods like the avalanche or debt snowball.

Worked Example

Let's look at an example to see how the roll down method works in practice.

Example Scenario

• Starting balance: $5,000
• Interest rate: 18% APR (1.5% monthly)
• Minimum payment: 2% of balance (or $25, whichever is greater)

Calculation Steps

Each month, we'll calculate:

1. The interest charged for the month
2. The minimum payment due
3. The new balance after payment

In this example, it would take 36 months (3 years) to pay off the $5,000 balance using the roll down method with an 18% APR. The total interest paid would be $582.50, bringing the total amount paid to $5,582.50.