Are you tempted to only pay the minimum amount on your credit cards every month? Do you feel like you cannot afford to give more than that? Well, you might be paying a very large cost to do so. Read on to find out exactly how much minimum payments can cost you in the long run. Any person intrigued by this topic; go look at; get your loan approval quickly.

While it might be tempting to pay only the minimal amount due each month on your credit cards, it can cost you a significant amount of money for the entire duration of your debt. The minimum payment is calculated so low that it can often take more than twenty years to pay back your debt if you only pay the minimum amount. After you’ve done everything you can to lower your interest rates to a manageable range and you have prioritized which credit card you’ll pay off first, then it is time to understand how to pay higher than the minimum on that credit card.

An interesting spin on this

So, add up all of your minimum payments for last month. Let’s imagine that they add up to $365. Then, you need to find out how much more you can pay towards your credit cards. If you can allocated $500 of your budget to your credit card payments each month, then you’re going to be $135 closer each month to realizing your dream of zero credit card debt.

Continuing On….

One of the best tools available for helping you do the calculations is the minimum payment calculator found at BankRate’s website. This tool will enable you to enter in your credit card debt and your minimum payments and it will calculate how long it’ll take to pay off your card. It will also let you enter in a fixed amount that you will be able to pay each month and it will calculate that for you too.

Here is an example :If you have $2000 in debt on a credit card, 18.5 % Interest, and the minimum payment is 2.5 per cent of your debt, here’s the difference between paying only minimum payments (around $50 the first month) and paying $100 every month until it is paid off.

The next step is to find the minimum amount of affordable monthly payments to help reduce the amount owed for the whole collection of credit card debt. The minimum monthly payment that you will be able to pay to alleviate credit card debt amounts to $500, for example. The total minimum payment under each of your three credit cards is $300 plus an extra payment of $10 for each card. Subtract the amount of total payments of $330 from your minimum monthly credit card repayment amount to find out that there is $170 left over.

Use the $170 remainder to pay the highest interest card debt every month until the credit card bill with the highest monthly interest has been given off and the debt from this one credit card has been eliminated. Once a credit card balance has been repaid, it is advisable to close the account and cut up this credit card to avoid accumulating additional charges and interest on the same card. You should also avoid opening up a new credit card account to replace the old paid off account and to prevent the aggravation of paying off your credit card debt again.

Continue to make monthly payments on the remaining credit card bills. Use the additional money saved from each previous monthly credit card debt repayment to pay back the next highest interest earning credit card. Avoid adding additional charges to the credit cards that you’re trying to pay back and instead use cash to be paid for items that you need. Continue this repayment strategy until all credit card debt has been eliminated.

It is recommended that you negotiate with current credit card companies in an attempt to lower interest rates as much as possible. Another credit card payment reduction strategy is to move the larger balance and interest rates to a credit card that has a zero percent promotional interest rate.

Minimum Payment: Will take more than 18 years to completely pay off and you’ll pay more than $2600 in extra interest.

Fixed $100 Per Month: Will take only 2 years to completely pay off and you’ll pay less than $400 in extra interest.

If you have more than one credit card to pay off, then use this credit card minimum payment calculator instead. The bottom line is that you need to give more than your minimum payment if you want to keep money and eliminate your credit card debt quickly! For more on this issue, check out: Your Guide to Reduce Credit Card Debt.

Credit card debt can build in the wink of an eye. However, it takes a focused effort to start really making a dent in the dollar amount. These proven techniques have helped many people reduce and even eliminate their credit card debt once and for all.

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