We did the math to show you how making these two small changes to your credit card payments can save you thousands, plus get rid of your debt years sooner.
When you’re carrying a credit card balance, paying at least the minimum due each month is certainly a start. If those payments aren’t making your overall budget feel squeezed, you have all the more reason to put payments on autopilot and not think about the total cost of your debt.When you’re carrying a credit card balance, paying at least the minimum due each month is certainly a start.
There is good news, though: Dedicating even a small amount of time and money to changing up your payment habits can be well worth the effort. “By paying $240 per month instead of $200, you’ll spend $4,966 less on interest and pay down your debt nearly three and a half years sooner. ” “You really want to sit down and look at the details that might make you uncomfortable, because it’s better to know than not to know,” McClary says. “Even if your budget is balanced each month and you’re making payments on time, you really need to know how much your debt is costing you.”
Going back to the example of the $10,000 balance, here’s the potential impact of upping your payments. Let’s say you felt comfortable committing an extra $10 a week, or $40 a month, toward debt. By paying $240 per month instead of $200, you’ll spend $4,966 less on interest and pay down your debt nearly three and a half years sooner. Even if you’re already making more than the minimum payment, paying even more than that can make a tangible difference.
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