in Credit Cards, Debt Reduction, Debts

I continue to clean up my huge archive. Many times I simply delete old silly content, but this topic is still valid. If you carry a large credit card balance, and make only minimum payments, you are in for a shock. Look for how long it will take to pay off the balance (it must be in your statement). This was originally published back in 2010.

My current credit card balance is quite large this month due to a bunch of specific previously planned expenses (and a couple that we hadn’t planned). ┬áThe bill will be paid on time, so there is not too much worry about starting a cycle of credit card interest charges (at least that is my plan, unless I forget to pay on time).

Having wandered through the wonderland of spending, I tripped across the following sentence:

credit card minimum payment
Example of how long a minimum payment will take only 18 years eh?

19 years? Aye Carumba, that is an astounding time frame. So my estimation if we were making this same payment that the effective yearly rate is about 20% and I’d end up paying in total about 500% of the initial amount on the credit line once all payments are made, pretty cool eh?

I realize that sometimes folks spending gets out of control. Sometimes, bad things happen that knock you off your financial feet. If this happens you must fight to get back to paying off the entire balance of your credit card monthly. The interest rates on Credit Cards can be over 20% and will dig a deep financial debt hole for you.

Some ideas you can do to stop paying Credit Card interest:

  • Set up an unsecured line of credit. This can be good, if you treat is as an Emergency only credit vehicle. Typically this has a lower interest rate, but it has risks. If you habitually use the LOC to pay off Debt, but can’t pay off that balance, maybe this is not the way to do it.
  • Consolidation loans or consolidation into your mortgage sounds good. If you use it once, it can get you back on track. If you use it habitually, that is a very bad thing. You are digging a bigger debt hole, more slowly.
  • Borrow it from your family or friends? A last resort, and it can destroy relationships, but it could work, short term.
  • Pay Day Loans? Absolutely, positively NO! Go talk to a licensed insolvency professional before you do this.

The amazing things you can read on your credit card statement.


  • Perry Casilio July 26, 2021, 12:14 AM

    Excellent post!

  • Afro Penny July 6, 2021, 6:05 PM

    What is even more shocking is that (at least in the U.S.) prior to the Card Act of 2009, lenders didn’t even have to include that surreal little statement.

  • B H August 1, 2015, 10:27 AM

    I remember seeing one statement a couple of years ago that said it would be something like 72 years to pay it back at the minimum. I admired their confidence in my longitivtiy! Perhaps that’s the real fountain of youth … pay your cards off at the minimum rate and they will assure you of staying alive for many many more years. Hehe.

  • Bret @ Hope to Prosper October 2, 2011, 1:24 PM

    The minimum payment warning was part of the new CARD Act that passed in the U.S. to reform the credit card industry. They did it because some people didn’t realize it would take decades to pay off their cards by making the minimum payment.

    I didn’t realize they would use it in Canada.

  • Traciatim September 26, 2011, 5:26 AM

    I think if you look at the question from the opposite direction you;ll find the answer to why credit card rates are so high.

    If you had a million bucks and you want to earn 6% per year on your money by lending it to people. You know somewhere between 10%-15% of those people will not pay you back. What interest rate do you have to charge to earn 6% on your money taking in to account your losses?

    • bigcajunman September 26, 2011, 9:35 AM

      Agreed, just a surreal time frame to see on a credit card bill. My first mortgage didn’t have that term!


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