Results of paying only minimum

You have a credit card or more than one.  You’ve spent and spent, and there are balances on each.  Within those balances are interest charges – every month, and possibly late fee charges.  The interest, now being part of the balance owed, will, next month, and every month until the bill is paid off, will add interest on the interest already there (it’s part of the balance owed). The thing is, whatever the interest rate is,  it’s a waste of your hard earned money. On most cards it’s anywhere from about 14% -28% (maybe more).

This means when you purchased an item(s) for $100.00, and when the bill came in, you paid the minimum – about $25.00, when the bill comes in next month, you still have $75.00 remaining on the item(s) purchased, but the balance due has interest added  to that amount at the rate in the credit card agreement.  Again, you pay the minimum, $25.00, but you missed the due date.  When the bill comes in the following month, you have the balance of the item(s) bought, $50.00, interest added on that remaining balance, plus the interest charges to date, plus a late fee of about $35.00.  That $100.00 item(s) are now costing you far more than that.

Adding purchases to the bill each month adds to the problem too.  By paying only the minimum each month, you will eventually be paying more in interest and any late fees than you do in your purchases.

This is how so many people get caught up in the vicious circle of financial debt.

The only way….. the only way to get out of it is to stop using credit cards, and pay off your balance(s) as quickly as you can.

If you insist upon using credit cards, and if you want to stay out of credit card debt, do not make a purchase that you don’t have the money for.  And when the bill comes due, pay the entire balance in full and before the due date.

It’s the only way to use a credit card.  It’s common sense. It can be done.