Credit Card Payoff
Calculate debt-free date.
Debt Payoff Strategies
Two popular methods for tackling credit card debt:
- Avalanche Method: Pay minimums on all cards, then throw every extra dollar at the card with the highest interest rate. Mathematically, this saves the most money.
- Snowball Method: Pay minimums on all cards, then focus on the card with the lowest balance. knocking out small debts quickly builds psychological momentum.
The Cost of Minimum Payments
Banks design minimum payments (usually 1-3% of balance) to keep you in debt for years. On a $5,000 balance at 18%, paying only the minimum could take over 15 years to pay off!