Credit Card Interest
Can Make Up A Large Part of Credit Card Debt
The average American has over $8,000 in credit card debt today – much of which is accumulated credit card interest - and that can take years to pay off, even with no additional purchases. If you’re only making the minimum monthly payments, you might be shocked to learn that you’ll definitely end up paying more in credit card interest than the amount of what you originally charged! And that means you’ve paid for everything twice and then some - just for the privilege of using that credit card.
How Credit Card Interest Affects Your Credit Card Debt
Let’s say you owe $10,000 in credit card debt - and you’re paying 20% interest on the card. Let’s say you pay the minimum payment of $250 each month. So how long will it take you to pay off that ten grand? 29 years! And at the end of those 29 years, you will have paid not only that initial $10,000, but also an additional $17,575 in credit card interest.
Why Shopping for Low Interest Credit Cards Matters
Here’s how shopping for a low-interest credit card can help you pay off excessive credit card debt. Let's look at the same $10,000 credit card debt - but at a 15% interest rate. If you still pay only the $250 minimum, the debt gets eliminated in 21 years instead of 29 - and the credit card interest will only come to $9,047, saving you over $8000. Still not a great deal, but at least you haven't paid more in credit card interest than in principal.
Your Credit Card Debt Will Never Be Paid Off with Minimum Payments
The key to getting rid of credit card debt and large finance charges is to pay more than the monthly bill requires. If you owe $10,000 on a low-interest credit card with around 15% and pay $300 instead of $250, you cut your repayment time to only 16 years - and the total credit card interest comes down to only $6,518. By paying only $50 more per month, you’ve saved over $2,500 and shaved 5 years off of your credit card debt!
Limiting Credit Card Interest and Paying Over the Bill: The Winning Combination for Paying Off Credit Card Debt
Looking at the cold, hard figures above, it might look like it's impossible to pay off your credit card debt. It's easy to see that if you have to use credit cards, it pays big to (a) shop for the lowest interest rate credit card and (b) pay as much over the minimum monthly payment as you can. The credit card company will still make money off you - that’s why they exist - but you can control the credit card debt to a manageable amount.
To shop for a Low-Interest Credit Card to provide some Credit Card Debt relief, visit:
