Why is it better to pay more than the minimum payment on your credit card?

+1 vote
asked Jan 25, 2018 in Other-Finance by Vallorz (250 points)
Why is it better to pay more than the minimum payment on your credit card?

1 Answer

0 votes
answered Jan 25, 2018 by Judy (56,120 points)
There's no requirement for you to pay the minimum payment on your credit card but it is best to pay more than the minimum payment on the credit card and the reason why it's much better to pay more than your minimum credit card payment is you're able to get the balance paid off quicker and you pay less in interest by doing so.

If you only pay the minimum credit card payment it takes longer to pay off the balance and you incur more interest which adds up.

And in most cases when you only pay the minimum payment on the credit card balance the minimum payment only covers the interest you're charged and you'll never pay off the credit card balance.

Paying more than the minimum is also better for your credit score since it shows you're responsible with paying your credit cards or other loans.

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