# 47 years to pay off one credit card. **URL:** \ **Category:** Miscellaneous and Personal Stuff I Must Share\ **Created:** [August 25, 2009, 6:58pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666 "2009-08-25T18:58:10Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Colophon](https://avatars.discourse-cdn.com/v4/letter/c/f05b48/32.png) [@Colophon](https://boards.straightdope.com/u/Colophon)\ **Post date:** [August 25, 2009, 6:58pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/1 "2009-08-25T18:58:10Z")
I have a balance of £1,415.59 on a credit card. Not a huge amount, right? Well, I was looking at the statement and saw that (a) the minimum payment this month was only £31 (i.e. 2.25% of the balance), and (b) the interest worked out at 22.8% APR. Plugging those numbers into this [handy calculator](http://www.whatsthecost.com/snowball.aspx), and leaving the repayment amount blank so that it bases the sums on minimum payment only, I find that it would take **566 months** to pay off, at a cost of **£5,910** in interest. :eek: :eek: I knew credit cards were extortionate, but that is ridiculous. If I never looked at my statements (and I’m sure some people don’t) and just let them take the direct debit for the minimum payment each month, I wouldn’t clear the card until October 2056! I think I will be paying this card off ASAP, cutting it into small pieces and posting it back to the “Royal” Bank of Scotland. ---
**Author:** ![Giles](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/giles/32/60_2.png) [@Giles](https://boards.straightdope.com/u/Giles)\ **Post date:** [August 25, 2009, 7:10pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/2 "2009-08-25T19:10:13Z")
You don’t need to cut up your credit card, you just need to accept that you ought to pay more than the minimum each month – and pay it off in full, if possible, before you pay of debts at lower interest rates. ---
**Author:** ![Colophon](https://avatars.discourse-cdn.com/v4/letter/c/f05b48/32.png) [@Colophon](https://boards.straightdope.com/u/Colophon)\ **Post date:** [August 25, 2009, 7:15pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/3 "2009-08-25T19:15:38Z")
> [@Giles](#): > > You don’t need to cut up your credit card, you just need to accept that you ought to pay more than the minimum each month – and pay it off in full, if possible, before you pay of debts at lower interest rates. I know that. It’ll be paid off within four months. But for various reasons RBS has pissed me off enough that I will be getting rid of the card anyway (putting up the interest rate twice, reducing the credit limit as soon as the balance is cleared, preventing me from using it for balance transfers, and reducing their minimum payments to the current ridiculous level, among them). ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [August 25, 2009, 9:20pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/4 "2009-08-25T21:20:29Z")
> [@Colophon](#): > > I know that. It’ll be paid off within four months. But for various reasons RBS has pissed me off… reducing their minimum payments to the current ridiculous level I don’t understand why you’re angry with them for not requiring you to pay more on your credit card. You’d be happier if they were _less_ flexible? ---
**Author:** ![Colophon](https://avatars.discourse-cdn.com/v4/letter/c/f05b48/32.png) [@Colophon](https://boards.straightdope.com/u/Colophon)\ **Post date:** [August 25, 2009, 9:44pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/5 "2009-08-25T21:44:36Z")
> [@iamthewalrus\_3](#): > > I don’t understand why you’re angry with them for not requiring you to pay more on your credit card. You’d be happier if they were _less_ flexible? Do you think it’s very ethical to set the minimum payments so low that it would take 47 years, and more than four times the original loan in interest, to pay it off? Minimum payments have been creeping down recently, to the extent that they are almost “interest-only”. I know and you know that paying only the minimum is a Bad Idea, but plenty of stupid, careless or lazy people are being taken for big ride. ---
**Author:** ![Snarky\_Kong](https://avatars.discourse-cdn.com/v4/letter/s/a183cd/32.png) [@Snarky\_Kong](https://boards.straightdope.com/u/Snarky_Kong)\ **Post date:** [August 25, 2009, 9:56pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/6 "2009-08-25T21:56:19Z")
> [@Colophon](#): > > Do you think it’s very ethical to set the minimum payments so low that it would take 47 years, and more than four times the original loan in interest, to pay it off? > > Minimum payments have been creeping down recently, to the extent that they are almost “interest-only”. I know and you know that paying only the minimum is a Bad Idea, but plenty of stupid, careless or lazy people are being taken for big ride. This isn’t changing the rates without notice or mailing the bill late so that a late fee is likely. It’s absolutely ethical to allow low minimum payments. The problem here isn’t really the minimum payment, it’s the 22% interest. I’m a poor as hell grad student that used to miss payments semi-regularly and my interest rate is 9%. ---
**Author:** ![SeaDragonTattoo](https://avatars.discourse-cdn.com/v4/letter/s/df705f/32.png) [@SeaDragonTattoo](https://boards.straightdope.com/u/SeaDragonTattoo)\ **Post date:** [August 25, 2009, 10:29pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/7 "2009-08-25T22:29:38Z")
That’s why I, having figured out that I will rack up a credit card if i have it available, have gotten rid of all of them but one with a $500 limit, for emergencies. I’ve been able to save cash for the first time over the last 2 years, and it feels great. I’ll never go back to the credit card balance game again. ---
**Author:** ![Rigamarole](https://avatars.discourse-cdn.com/v4/letter/r/77aa72/32.png) [@Rigamarole](https://boards.straightdope.com/u/Rigamarole)\ **Post date:** [August 25, 2009, 10:33pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/8 "2009-08-25T22:33:03Z")
Wait, you think _credit cards_ are extortionate? You should really check out payday loans. ---
**Author:** ![Hockey\_Monkey](https://avatars.discourse-cdn.com/v4/letter/h/a183cd/32.png) [@Hockey\_Monkey](https://boards.straightdope.com/u/Hockey_Monkey)\ **Post date:** [August 25, 2009, 10:34pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/9 "2009-08-25T22:34:57Z")
> [@Colophon](#): > > Do you think it’s very ethical to set the minimum payments so low that it would take 47 years, and more than four times the original loan in interest, to pay it off? > > Minimum payments have been creeping down recently, to the extent that they are almost “interest-only”. I know and you know that paying only the minimum is a Bad Idea, but plenty of stupid, careless or lazy people are being taken for big ride. This isn’t news…it’s pretty much always been this way. Credit card companies make money off the ignorant. Most people just don’t realize how long it will take them to pay off their debt if they only make the minimum payment. ---
**Author:** ![Johnny\_L.A](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnny_l.a/32/1084_2.png) [@Johnny\_L.A](https://boards.straightdope.com/u/Johnny_L.A)\ **Post date:** [August 25, 2009, 11:54pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/10 "2009-08-25T23:54:07Z")
There’s a café in Bellingham, Washington (or Fairhaven, if you prefer) called [Colophon Café](http://www.colophoncafe.com/). You should give your credit card one more good charge and eat there. 😉 ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [August 26, 2009, 6:30pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/11 "2009-08-26T18:30:24Z")
> [@Colophon](#): > > Do you think it’s very ethical to set the minimum payments so low that it would take 47 years, and more than four times the original loan in interest, to pay it off? Yes. I think it would be ethical to have no minimum payment at all, as long as the terms and interest rate are made clear. It’s the minimum payment, not the maximum payment or recommended payment. It’s not the credit card company’s job to figure out your finances for you. And a low minimum payment is actually a benefit if you hit a bump in your finances and need to take a short term high interest loan from your credit card. ---
**Author:** ![Dinsdale](https://avatars.discourse-cdn.com/v4/letter/d/97f17d/32.png) [@Dinsdale](https://boards.straightdope.com/u/Dinsdale)\ **Post date:** [August 26, 2009, 6:43pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/12 "2009-08-26T18:43:16Z")
> [@Colophon](#): > > I know and you know that paying only the minimum is a Bad Idea, but plenty of stupid, careless or lazy people are being taken for big ride. I have no idea what the interest rate is on any of my credit cards. Of course, I’ve never carried a balance. I’ve got no problem with folks paying for their stupidity, carelessness, or laziness. ---
**Author:** ![Triskadecamus](https://avatars.discourse-cdn.com/v4/letter/t/b19c9b/32.png) [@Triskadecamus](https://boards.straightdope.com/u/Triskadecamus)\ **Post date:** [August 26, 2009, 6:51pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/13 "2009-08-26T18:51:59Z")
I recommend making APOD: [Astronomy Picture of the Day](http://antwrp.gsfc.nasa.gov/apod/astropix.html) your home page. A bit of ignorance fought every day. And really neat pictures, too. Click on the picture, and the click on it again, and get it at full size. Amazing. Tris ---
**Author:** ![Fleetwood](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fleetwood/32/271_2.png) [@Fleetwood](https://boards.straightdope.com/u/Fleetwood)\ **Post date:** [August 26, 2009, 7:33pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/14 "2009-08-26T19:33:22Z")
> [@Dinsdale](#): > > I have no idea what the interest rate is on any of my credit cards. Of course, I’ve never carried a balance. > > I’ve got no problem with folks paying for their stupidity, carelessness, or laziness. I agree, Dinsdale. In addition, those people support my cash-back and rewards programs. I charge thousands (granted, a big chunk is business travel related and reimbursed by my company) every year and haven’t paid a dime in interest charges since the 80’s. ---
**Author:** ![gigi](https://avatars.discourse-cdn.com/v4/letter/g/a587f6/32.png) [@gigi](https://boards.straightdope.com/u/gigi)\ **Post date:** [August 26, 2009, 8:44pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/15 "2009-08-26T20:44:12Z")
> [@Hockey\_Monkey](#): > > This isn’t news…it’s pretty much always been this way. Credit card companies make money off the ignorant. Most people just don’t realize how long it will take them to pay off their debt if they only make the minimum payment. My friend told me her co-worker was bemoaning never getting ahead on her debt; turns out she thought you weren’t allowed to pay more than the minimum. :smack: ---
**Author:** ![Malthus](https://avatars.discourse-cdn.com/v4/letter/m/85f322/32.png) [@Malthus](https://boards.straightdope.com/u/Malthus)\ **Post date:** [August 26, 2009, 8:49pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/16 "2009-08-26T20:49:48Z")
Credit cards are merely a convenience. Only the truly desperate or foolish use them as a source of actual loans. ---
**Author:** ![Jorge\_Burrito](https://avatars.discourse-cdn.com/v4/letter/j/e9bcb4/32.png) [@Jorge\_Burrito](https://boards.straightdope.com/u/Jorge_Burrito)\ **Post date:** [August 26, 2009, 9:56pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/17 "2009-08-26T21:56:22Z")
> [@Malthus](#): > > Credit cards are merely a convenience. Only the truly desperate or foolish use them as a source of actual loans. Nonsense, credit card are a source of profit for the smart. I have made thousands of dollars off of the credit companies via two methods. The first is rewards and is pretty simple. Through use of two cards depending on what I am buying I have probably averaged about 3% cash back on all purchases I make. Of course these get paid off in full monthly. This is fairly common knowledge. The second is taking out 0%/0 fee balance transfer offers from credit cards and dumping the money into a high yield savings account. I have made more money off of this than I have off of rewards. It takes some work and you have to be very diligent on meeting the terms of the introductory offer, but on a forum i visit there are people that for awhile were making $5,000+/year off of this. This form of arbitrage has sadly dried up due to the credit crisis, the lack of 0% offers, and the dismally low interest rates. ---
**Author:** ![Rigamarole](https://avatars.discourse-cdn.com/v4/letter/r/77aa72/32.png) [@Rigamarole](https://boards.straightdope.com/u/Rigamarole)\ **Post date:** [August 26, 2009, 10:00pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/18 "2009-08-26T22:00:32Z")
> [@Jorge\_Burrito](#): > > The second is taking out 0%/0 fee balance transfer offers from credit cards and dumping the money into a high yield savings account. I have made more money off of this than I have off of rewards. It takes some work and you have to be very diligent on meeting the terms of the introductory offer, but on a forum i visit there are people that for awhile were making $5,000+/year off of this. This form of arbitrage has sadly dried up due to the credit crisis, the lack of 0% offers, and the dismally low interest rates. Let me guess, fatwallet? Yeah, I’ve done it too. If you’re smart and careful, you used to be able to game the system pretty well. ---
**Author:** ![Liberal](https://avatars.discourse-cdn.com/v4/letter/l/848f3c/32.png) [@Liberal](https://boards.straightdope.com/u/Liberal)\ **Post date:** [August 27, 2009, 3:25am UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/19 "2009-08-27T03:25:03Z")
Never use a credit card as a loan tool. Save your money until you can afford what you need slash want. Use your credit card as a convenience item for travel, etc. But never use it unless you have the funds set aside to pay it off in full. ---
**Author:** ![LSLGuy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lslguy/32/5813_2.png) [@LSLGuy](https://boards.straightdope.com/u/LSLGuy)\ **Post date:** [August 27, 2009, 1:54pm UTC](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666/20 "2009-08-27T13:54:22Z")
> [@Malthus](#): > > Credit cards are merely a convenience. Only the truly desperate or foolish use them as a source of actual loans. I bought my last car on a credit card. $30,000 for a used BMW. 2% percent APR (that’s the annual rate, not monthly). No annual fee. The best my bank would do was 4.8% for 5 years with 10% down. I intend to pay the bare minimum on that card forever until the balance hits zero some time in the late 2040s. The car will be gone long before the balance is. Meanwhile, my capital is earning rather more than 2% while the bank pays me to own & drive the car. Hell, inflation has averaged more than the APR. Sadly, I haven’t seen introductory deals like that for a couple years now. So while I agree with your sentiment for most cards and most people most of the time, it certainly isn’t true for all cards for all poeple all of the time. [Next page](https://boards.straightdope.com/t/47-years-to-pay-off-one-credit-card/507666.md?page=2)