How Long To Pay Off Debt With Minimum Payments?
You may wonder how long it will take to pay off a credit card or other unsecured loan by making the minimum payment. Well, I have to tell you that if have run up a substantial balance, let’s say a few thousand dollars, it will take awhile if you can manage it at all. Let’s say you have a fairly moderate $3500 balance. And lets say your interest rate is reasonable, say 14%.
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Well, if you make $85 a month payments, it can take 4 and a half years, and you will have paid out almost $1200 on interest on that $3500 of debt! If you can swing $150 a month payments, you can reduce your payoff time to about 2 1/3 years, and almost cut the interest in half.
Of course, if you get sucked into the extra services, like credit protection, that the companies try to tack onto your bill, a minimum payment will make even less progress.
debt, loans, credit card, debt payoff, debt reduction, bad credit
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