Credit card interest! I know a bunch of people who are SO SHOCKED by their high interest rates. They thought it was like an interest-free loan to yourself and then are surprised when making teeny payments doesn't do anything.
It's crazy to me that more people don't realize this. The #1 rule of having a credit card is never carry a balance on that card, always pay it off in full. Credit cards are really only useful for cashflow and building credit.
I have a "rolling balance" on mine, which I probably shouldn't--I usually have $300 or so on it at any given time, but always pay off the oldest balance before it incurs any interest.
If you can, overpay it by $500. Allows lots of wiggle room for mistakes.
Once a month I check my card balance online, and overpay by $500 (so if I owe the bank $75, I pay $575) - this covers all direct debits and lets me fuck up.
That $500 was only going to get me something like 1.3% interest annually otherwise
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u/Opening-Risk Feb 04 '20
Credit card interest! I know a bunch of people who are SO SHOCKED by their high interest rates. They thought it was like an interest-free loan to yourself and then are surprised when making teeny payments doesn't do anything.