I just got my credit card bill. It’s over 5000 grand for the month. Now – before you start thinking – what is this girl doing, giving out financial advice when her credit card bill is so high?! It does have mostly essentials on it (transportation, groceries, gas), but I’ll freely admit that it has some not so essentials on it (dinner out and Mr. Canuck Buck’s trip to HMV). The biggest chunk is medical, alas – something that is not covered by our health care system or insurance. So, I am normally a tad more frugal.
Anyway, a note on the last page of the bill caught my eye. It says “If you only make the minimum payment every month, it will take approximately 21 year(2) and 11 month(2) to pay the entire new balance shown on this statement.
21 years?! Almost 22 years? Are they nuts? I’m hoping to be retired in 21 years – not still paying off a credit card bill I ran up in my 30′s. And that’s assuming I don’t ever spend anything else again on this credit card.
I had friends in university who just paid off the minimum on their card and thought they were doing well. I didn’t really have that option – my parents did not co-sign anything for me (I never thought to ask!), so the most credit I could get was 500 bucks a month. I remember a “friend” lording it over me that she had a higher credit limit than me because her parents had cosigned for her. She was much quieter about the whole situation once she had to start paying off her bill.
I guess I just can’t understand why on earth you would take the route of only paying the minimum. I know I’m lucky I’ve never been in truly dire financial need where I couldn’t pay off my credit card bill, but I’d like to think good sense, and a bit of restraint have helped me from running up a bill I couldn’t afford.
If you are in the situation – get the heck out of it! While you really need to take a good, long look at your spending habits, you may need to take some drastic measures in order to pay your bill of faster. There’s anything from getting extra hours at work, to transferring to a lower interest card, to negotiating with your credit card company. They’re all worth a shot – cause who wants to be paying a bill you racked up 20 years later!
Have you ever just paid the minimum on your credit card? How did you break free from this habit?