Instead of working in your favor (as with a savings account), the power of compound interest works against you with debt.
If you start with a $500 balance on your credit card at 19.8% interest, then each year make two additional charges of $75 each, and pay only the minimum monthly payment of 3.5% of the balance or $20, whichever is greater, after 25 years the interest charges amount to $3,121.
After 25 years, you still have a balance of $624!
Tags: compound interest, credit card, Primerica, savings
This entry was posted on Friday, April 30th, 2010 at 3:12 pm and is filed under Primerica. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
July 28th, 2010 at 9:37 pm Evelyn Says:
Share with all your friends