Should I Really Only Pay the Minimum on My First Credit Card?

Consider your credit card payments carefully.

You Will Have More Cash Now

Obviously, if you only pay the minimum payment due on your credit card, you will have more cash right now. This can be helpful if you have other urgent bills due, like medical expenses, utility bills or rent, and even payments to make on other credit cards with a higher interest rate.

You Will Ultimately Pay More

Because you are paying interest on your credit cards, you will pay exponentially more in the long run if you only make the minimum payment. The minimum payment may not even cover the interest accrued that month, which means your balance will actually begin increasing, instead of decreasing, as you begin paying interest on your interest.

Bottom Line

Making only the minimum payment on your credit card is expensive. Unless you have other urgent bills, such as food and shelter, that need to be paid, make more than the minimum payment on your credit card bill to pay it down more quickly and save yourself thousands of dollars.