For everyone who has ever had a credit card which is about 10 out of every 9 of us, know all about the minimum card payment that you need to make each month in order to avoid extras fees if you miss them as well as hopefully getting the card paid off on day soon. Although they seem like an awesome benefit to buying something that has a big price tag and paying it off over time, the minimum credit card payment is created for one reason, to keep you in debt and keep you paying much more than you actually owed in the first place.
This article will provide you with all the information about the mininum credit ard payment to inform you of what you are gettign yourself into when you start the minimum payment or information for those who have a minimum credit card payment they are currently paying, as well as remedies to either stay away from them or pay them off in record time, which is exactly what they don’t want you to do! Read on for more information.
Minimum Credit Card Payment – Overview
Comanies that are offer you credit cards are a bit sneaky when they are advertising you to be a card holder with them. They know that their cards look clean, a lot cleaner than money and their are banking on you thinking this as well as thinking that a credit card is so much simpler than carrying around and using money for your purchasesThis section is dedicated to educating you on what a minimum credit card payment is and all that it entails.
- Basically the credit card minimum payment is like getting a loan for what you are buying then having to pay each month to pay back that loan which sounds greaat first, but heres where they get you. After you buy the item and get on a minimum monthly payment plan, they start adding interested to each payment that tends to increase the further along you get into your payment plan.
- Usually this montly payment equates to about 2 to 4 percent of what is due along with the interest on these payments, the debt companies are constantly collecting a lot more than what you really owe. They put these payments so low because they know it will take you longer to pay off, collecting each month you pay. Keep this in mind, at just 2 percent, you will end up paying just close to double the amount of the original debt. Also remeber interested tends to increase as you get further into your payment plan
This double edge sword doesn’t stop here. These are the basics you need to know to inform you on the minimum credit card payment. If you have one or more now that you are paying on, the next section will reveal a couple tips to help you get them off your back as well as how much you will save if you pay more than the minimum.
Getting rid of your Minimum Credit Card Payment
- Paying more than the minimum each month will do you wonders. Just for numbers sake, lets say you have a 20,000 dollar debt. If you pay just 15 dollars more a month on the debt you can save 40,000 dollars in interest ballpark, depending on what you would pay on interest.
- Great ways to make these extra payments that are over and above your minimum credit card payment is to make a budget of what you are spending. Seperate this list into must do’s and haves on one side, on the other put the you pleasure activities that you are spending money on each month. With this side of the list, each month you can decide not to do one thing on the list, and use the money you would have spent towards putting it to paying more than just the minimum each month. IF you don’t want to eliminate that leisure activity in totality, then alternate the things you decide not to do each month so you aren’t taking one of your favorite things to do off the list for good. This will avoid be stuck in which can be up to a 30 year debt, and paying offer your minimum monthly bill in record time, and at the same time making the credit card companies incredibly angry that their evil planned failed with you.
The only real time that a credit card can be a good option for you is if you are going to be buying items and are going to pay the full balance at the end of the month. For these people, no you know to avoid minimum credit card payments and for the people who have them now, you now know how to kick the payments once and for all!