Budgeting & Debt
Months to clear
The standard amortisation formula solved for the number of payments.
The Formula
Months = -ln(1 - r x B / P) / ln(1 + r)
The standard amortisation formula solved for the number of payments.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| r | Monthly rate | rate | APR divided by twelve. |
| B | Balance | currency | Statement balance on the card. |
| P | Payment | currency | Amount paid each month. |
What Each Symbol Means
rrate
Monthly rate
APR divided by twelve.
Bcurrency
Balance
Statement balance on the card.
Pcurrency
Payment
Amount paid each month.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate minimum payments page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate Minimum Payments, filed under Finance. Every number the guide produces comes from substituting into this one line.