What a penalty-adjacent rate costs

Rates near the top of the card range are usually discussed as a percentage. A percentage is hard to feel, so this study holds the balance and the monthly payment fixed and changes only the rate, then reports what happens to the term and to the total interest.

Every comparison here is a matched pair — the same balance and the same payment at both of the rates being compared — because a median taken across rates would be a median over a population that changes with the variable. Where either side of a pair fails to clear the card, the pair is skipped whole and counted.

What the data shows

• The same balance and the same payment, at 19.99% and at 29.99%: a median $1,764.91 more interest and 7 mo longer, over 18 matched pairs. The worst pair cost $10,563.77 more and 1 yr 11 mo longer.
• Stated as a multiple rather than a difference, the higher rate cost a median of 1.93 times the total interest of the lower one.
• Interest takes a median 62.48% of the first payment at 29.99%, against 41.65% at 19.99% — which is why the balance appears not to move.
• At 29.99% a payment of 2% of the balance never clears the card: 6 of the 6 balances tested, at every balance in the grid. Those are the pairs missing from the comparison above, and they are reported rather than dropped.

Drawn at $5,000.00 paying $200.00 a month — one cell of the 24 in the grid. The paired figures above are medians across every cell; the table and the download carry all of them.

Drawn at $5,000.00 paying $200.00 a month — one cell of the 24 in the grid. The paired figures above are medians across every cell; the table and the download carry all of them.

Drawn at $5,000.00 paying $200.00 a month — one cell of the 24 in the grid. The paired figures above are medians across every cell; the table and the download carry all of them.

The dataset

Showing 12 of 120 rows. The complete dataset — every row and every column — is in the CSV.

Download the full dataset (CSV) 120 rows · 8 columns

The table shows the dataset's own rows, formatted as this site formats money and terms. The download carries the same rows unformatted, which is what a spreadsheet wants.

What was varied

Balances

$1,000.00 · $2,500.00 · $5,000.00 · $7,500.00 · $10,000.00 · $15,000.00

Rates compared

9.99% · 14.99% · 19.99% · 24.99% · 29.99%

Monthly payments

2% · 3% · 4% · 5% of the opening balance, so the same payment can be compared across rates

Comparison

every figure is a matched pair — the same balance and the same payment at 19.99% and at 29.99%

Seed

not seeded — an exhaustive sweep of a declared grid, not a sample

What was held constant

Minimum payment (held constant)

No minimum-payment rule is applied at all. The monthly payment is a declared share of the opening balance, held fixed across every rate in a pair, so the rate is the only thing that moves. The cases where such a payment never clears the card are reported rather than dropped.

Behaviour

A single balance, a fixed monthly payment, no new spending and no fee. Interest is charged monthly on the balance carried.

Payments

The payment shares are declared here, not claims about what any issuer requires.

Plan anchor

January 2026 — pinned, so a rerun on any day produces identical output. These studies report terms and interest, never dates, so the anchor changes no published figure.

Data

Synthetic throughout. No customer data was used, approximated or fitted, and nothing here is a claim about what borrowers actually owe.

Engine version

payoff-25e86113b543

What was excluded, and how much

• 12 excluded — the payment does not exceed the month's interest at that rate, so the card has no term to report.

How this was computed

Every comparison walks the same balance and the same payment at each rate, so the rate is the only thing that moves between the sides of a pair. Where either side fails to clear the card, the whole pair is skipped and counted — a comparison of medians taken across rates would otherwise report the higher rate finishing sooner, because the cases it never clears drop out of its own average.

That is not a hypothetical. It happened on the way to this page, and it is why every figure above is paired.

What the model assumes

A single balance, a fixed monthly payment, no new spending and no fee. Interest is charged monthly on the balance carried, which is the engine's model and the shape a revolving balance follows once a grace period no longer applies.

The payments are set as shares of the opening balance so that the same payment can be compared across rates. They are not claims about what any issuer requires.

What this does not show

It does not show how rates are set, how often a penalty rate is applied, or what your own agreement allows. It also does not model a rate that changes partway through, which is the more common real experience.

The grid here is small and exhaustive rather than large and sampled, so it carries no sampling error and no claim to represent a population.

Synthetic data, and why

No customer data was used. The grid is declared in full in the method block, the dataset below is the whole of it, and re-running the generator reproduces it exactly.

Sources

1. Consumer Financial Protection Bureau — How does my credit card company calculate the amount of interest I owe? (tier 1)
2. Consumer Financial Protection Bureau — What is a grace period for a credit card? (tier 1)

Our source and corrections policy explains how these are chosen.

Related

• Credit card payoff calculator
• How credit card interest works
• Where a minimum payment stops working
• Methodology