so i just had a major shock when looking at my credit card statement. i got my email saying my statement was ready and due january 15th. so i go to look at it knowing it was going to be redic high. this billing cycle i bought a bed, a plane ticket to europe, train tickets for europe, some christmas presents, and the usual things i put on my credit card (gas, ezpass, netflix) so my damage this month was $2987. now i pay my credit card off in full every month and usually my payment is maybe $200. so i was shocked to see the minimum payment for $3000 was only $44! $44! that is like 1.5% of my bill. 1.5%!?! so if i only paid the minimum i would have about $450 in interest (my rate is low for a credit card 15%) so i can see how the cycle of credit card debt can spiral out of control.
i was sitting there in shock and just flabbergasted at how little the minimum payment is.
i try to only use my credit card sparingly and for larger purchases, knowing i have money in my checking account or savings to pay it off. and i know i am lucky that i have savings (at this stage 2 years ago, i had nothing) but i am just in shock at how crazy credit card companies are.
have you ever had a financial realization that just blew you away? how is your relationship with your credit card?
4 comments:
I dont have a credit card - well i do have one that is attached to my parents so that when I go shopping for them, I use that and that way they dont have to be writing me checks all the time. But credit is scary - people are always "just paying the minimum" and it KILLS your credit score (mine sucks because of a disputed bill.. but whatever...)
Yeah, it's ridiculous how little they ask you to pay each month. I use my credit card for everything, as I'm trying to rack up my points so I can use them for a flight at some point in the next few years. However, I sit down with my receipts once a week and pay everything off, so I never have to pay interest.
I wasn't always so good with money, but after a few years of bad decisions, I finally got things under control and am debt free. It's sad how easy it is for people to overspend and rack up the debt. Good for you for having savings and paying things off! It's a valuable thing to be in the habit of doing.
Wow that is crazy, that payment is so low for such a high bill. Insane! Yes, when those bills come around with all the travel expenses, it hurts. Gosh that stuff adds up fast!
i guess i just couldn't imagine only paying the minimum. my payment (which i pay in full every month) is around the same, so i feel like the monthly payment is only going to increase as i continue to buy things, so why would i get caught in that? i just don't buy anything beyond my means (and still freak out when my 'christmas' statement was $1400.
i do use my credit card for nearly everything, in order to rack up cash back points. i haven't ever cashed them in yet, but i've got $240 or so ready to be cashed in.
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