not paying off credit card

[mr_chin]

Every month, even if I pay the minimum payment, the next month, interest is still being added. So what is the point of paying minimum payment?

Wouldn't it better off if I just leave it until I can pay the whole balance off?

If I can't pay the whole balance off month by month, it's basically pointless to even try because every month after, the interest is the amount I paid the month before.

For example

June, purchase interest and cash advance interest adds up to $150. I pay it that month. Balance sits at $8000 because none of my payment actually went to the balance, only to the interest.
July, it adds up to $150 again. I pay it that month. Balance still at $8000.
August, again $150 interest. I don't have month to pay. Balance at $8150.
September, don't have month again. Balance at $8300.
October, don't have money again. Balance at $8450.

So June and July's payment was pointless.

[tkdwns89]

isnt interest like cumulative.
so if it was 10% of 100 it(10$) would be 110$ then next month the 10% of that(11$) so 121$ and on.
dont own a CC so dont know much..
and for june and july, u have that much less to pay when you actually have enough cash to pay it off.

[RFlush]

Originally Posted by aznlangjai

Every month, even if I pay the minimum payment, the next month, interest is still being added. So what is the point of paying minimum payment?

Wouldn't it better off if I just leave it until I can pay the whole balance off?

If I can't pay the whole balance off month by month, it's basically pointless to even try because every month after, the interest is the amount I paid the month before.

For example

June, purchase interest and cash advance interest adds up to $150. I pay it that month. Balance sits at $8000 because none of my payment actually went to the balance, only to the interest.
July, it adds up to $150 again. I pay it that month. Balance still at $8000.
August, again $150 interest. I don't have month to pay. Balance at $8150.
September, don't have month again. Balance at $8300.
October, don't have money again. Balance at $8450.

So June and July's payment was pointless.

It's people like you who the credit card companies love and chase.

I bet you are the type of guy who accepts all the credit card offers that come in the mail.

[Klobbersaurus]

Originally Posted by aznlangjai

Every month, even if I pay the minimum payment, the next month, interest is still being added. So what is the point of paying minimum payment?

Wouldn't it better off if I just leave it until I can pay the whole balance off?

If I can't pay the whole balance off month by month, it's basically pointless to even try because every month after, the interest is the amount I paid the month before.

For example

June, purchase interest and cash advance interest adds up to $150. I pay it that month. Balance sits at $8000 because none of my payment actually went to the balance, only to the interest.
July, it adds up to $150 again. I pay it that month. Balance still at $8000.
August, again $150 interest. I don't have month to pay. Balance at $8150.
September, don't have month again. Balance at $8300.
October, don't have money again. Balance at $8450.

So June and July's payment was pointless.

now is the time to suck it up and get 2 jobs to pay off the debt, using credit card to buy stuff is one thing but using it for the cash advance is just dumb

[diesel_test]

Originally Posted by tkdwns89

isnt interest like cumulative.
so if it was 10% of 100 it(10$) would be 110$ then next month the 10% of that(11$) so 121$ and on.
dont own a CC so dont know much..
and for june and july, u have that much less to pay when you actually have enough cash to pay it off.

i thought interest on most credit cards are calculated annually correlated to the amount of $$$ you owe.


Say your balance is $2000 and interest rate is at 19.5%, annually you're paying $390 in interest.

Each month that is $32.50 in interest added to the balance.

[goo3]

Originally Posted by aznlangjai

Every month, even if I pay the minimum payment, the next month, interest is still being added. So what is the point of paying minimum payment?

Wouldn't it better off if I just leave it until I can pay the whole balance off?

If I can't pay the whole balance off month by month, it's basically pointless to even try because every month after, the interest is the amount I paid the month before.

For example

June, purchase interest and cash advance interest adds up to $150. I pay it that month. Balance sits at $8000 because none of my payment actually went to the balance, only to the interest.
July, it adds up to $150 again. I pay it that month. Balance still at $8000.
August, again $150 interest. I don't have month to pay. Balance at $8150.
September, don't have month again. Balance at $8300.
October, don't have money again. Balance at $8450.

So June and July's payment was pointless.

If you didn't pay in June and July, you'd owe > 8750 instead of 8450.

So what are you gonna do? CC interest is killing you. The sooner you get someone to help you out, the better.

Oh and cut up your cc's when you're done. You obviously can't handle it. Stick with cash and debit.

[CRS]

Originally Posted by diesel_test

i thought interest on most credit cards are calculated annually correlated to the amount of $$$ you owe.


Say your balance is $2000 and interest rate is at 19.5%, annually you're paying $390 in interest.

Each month that is $32.50 in interest added to the balance.

You'd think that wouldn't you?

The interest is charged monthly so by the end of the year (12x ____%) oh and cumulative of month adding on, he'd be down in the poor house with debt.

[mr_chin]

Originally Posted by goo3

If you didn't pay in June and July, you'd owe > 8750 instead of 8450.

So what are you gonna do? CC interest is killing you. The sooner you get someone to help you out, the better.

Oh and cut up your cc's when you're done. You obviously can't handle it. Stick with cash and debit.

So basically, what I am doing is only paying off the interest by paying the minimum payment.

So my question still stands, is it better to wait til I have the actual amount to pay off the whole balance or pay it off little by little, or chunk by chunk?

[RFlush]

Originally Posted by aznlangjai

So basically, what I am doing is only paying off the interest by paying the minimum payment.

So my question still stands, is it better to wait til I have the actual amount to pay off the whole balance or pay it off little by little, or chunk by chunk?

You really are dumb aren't you? Pay off whatever you can, minimum, less or more. Anything is better than nothing or else you will have interest on interest. If you wait until you pay off, you will be paying more in the long run.

Did you not read the contract before signing up for your credit card(s)?

I guess this is why credit cards take advantage of dumb folks like you. But this is always why mortgage companies got screwed over in the US lol.

From the sounds of it, aznlangjai, you really know nothing about money management and have no clue what to do. Best advice is to declare bankruptcy because it seems like you are never going to pay off your debt.

Good luck!

[CRS]

Originally Posted by aznlangjai

So basically, what I am doing is only paying off the interest by paying the minimum payment.

So my question still stands, is it better to wait til I have the actual amount to pay off the whole balance or pay it off little by little, or chunk by chunk?

Pay EVERYTHING. Like if you find 1 cent on the ground, pick it up and pay it towards your bill. I mean pay WHENEVER and HOWEVER MUCH you can. So if you have 120 in you bank and your debt is 500 and the min is 50, PAY ALL OF THAT 120.

[Gt-R R34]

Originally Posted by aznlangjai

So basically, what I am doing is only paying off the interest by paying the minimum payment.

So my question still stands, is it better to wait til I have the actual amount to pay off the whole balance or pay it off little by little, or chunk by chunk?

Answer: Pay Off whenever you have money.

You're basically screwed if you can't meet the monthly payment, i'd acutally consider helping you out but i would charge you a fee. You haven't even listen to any free advice that's been given in this thread. Maybe paid advice, you'd do something about your finances.

Put it this way - Minimum balance is 150, try paying 250 a month. I would instead say, get a loan with SET monthly amounts from a bank and SET years of a loan. However, since you can't get the loan *i'm gurantee that, because if you can't manage 150 a month, there's no way you'd be able to get it. SO ..."

MY FREE ADVICE -

SUCK IT UP - ASK MOMMY AND DADDY for a LOAN. Suck up your pride, pay off that loan, cut up the card so if you want a future with a house and car.

Thats the blunt way, professionally and paid for. It will be much more eloquent, with detailed advice and possible step by step to achieving your goal.

[yayabonks]

This is what i've heard from a friend that works in debt collection:

Credit card companies sell your profiles CHEAP (lesss than 20% of what they're worth). and they sell them to debt collectors (like the company my friend works at). keep in mind, they don't sell unless they are YEARS outstanding.

what they do is call and try to get you to pay the full amount of course. you will negociate something like paying half or something and they still make a good double profit at least from you.

i don't recommend doing this just like everyone else has been saying. because this will screw your credit. (ie you cannot take out loans or mortgages for a while until you get that credit back up)

[nipples]

depending on who the lender is (if it's PC, too bad), you can go to credit counselling (there's one in new west, van, richmond). it's a non profit one. i did this before for a good buddy of mine. the one we went to was bc credit counselling society (www.nomoredebts.org) only because they did not try to push one option over the others. They basically said 'come in, we'll have a talk. it doesnt even sound that bad so you might not even need our help.' whereas the other ones i called were all pushing consumer proposals or bankruptcy.

I say tough if you have PC because although bcccs is able to completely stop ALL interest charges on the majority of all credit cards, PC is unwavering and still wants i think it was 5% interest. they're cutthroat!

oh, btw, if you do decide to do do a consumer proposal or file for bankruptcy, remember you cant if you have unpaid student loans.

and another thing, if you chose to do the ones above, you might as well rack up a lot more debt before kissing good bye to credit for the next 7yrs and a ding on your file. that's what they told us. if you're going to do it, go big or go home.

hope this helps.

[nipples]

Originally Posted by diesel_test

i thought interest on most credit cards are calculated annually correlated to the amount of $$$ you owe.


Say your balance is $2000 and interest rate is at 19.5%, annually you're paying $390 in interest.

Each month that is $32.50 in interest added to the balance.

more like 2562.38 or thereabouts

[mr_chin]

Originally Posted by RFlush

You really are dumb aren't you? Pay off whatever you can, minimum, less or more. Anything is better than nothing or else you will have interest on interest. If you wait until you pay off, you will be paying more in the long run.

Did you not read the contract before signing up for your credit card(s)?

I guess this is why credit cards take advantage of dumb folks like you. But this is always why mortgage companies got screwed over in the US lol.

From the sounds of it, aznlangjai, you really know nothing about money management and have no clue what to do. Best advice is to declare bankruptcy because it seems like you are never going to pay off your debt.

Good luck!

What went up YOUR ass? I thought I'd be the one fustrated about my debt and yet you're here more fustrated about my owing more than me.

Obviously I have no clue about money management, that is why I'm here asking for advice, need to be anymore obvious, captain?

I'm in a situation that you don't even understand so if you have nothing helpful to say, why don't you go post in the fight club, since it seems that's where you belong.

Originally Posted by GTR R34

Answer: Pay Off whenever you have money.

You're basically screwed if you can't meet the monthly payment, i'd acutally consider helping you out but i would charge you a fee. You haven't even listen to any free advice that's been given in this thread. Maybe paid advice, you'd do something about your finances.

Put it this way - Minimum balance is 150, try paying 250 a month. I would instead say, get a loan with SET monthly amounts from a bank and SET years of a loan. However, since you can't get the loan *i'm gurantee that, because if you can't manage 150 a month, there's no way you'd be able to get it. SO ..."

MY FREE ADVICE -

SUCK IT UP - ASK MOMMY AND DADDY for a LOAN. Suck up your pride, pay off that loan, cut up the card so if you want a future with a house and car.

Thats the blunt way, professionally and paid for. It will be much more eloquent, with detailed advice and possible step by step to achieving your goal.

As far as I know, no one explained anything in this thread as to how interest work. And not everyone has mommy and daddy to help like you do, as for some, do grew up independently and no one to teach us these things.

Anymore insults to my childhood and personal lifestyle are welcome.

I have money in cash for half maybe 2/3 of what I owe, problem is, if I use all the money to pay off my credit card, I don't know if I can keep up with the remaining balance. If I pay off 2/3 of it, I might not be able to pay of the other 1/3, then interest will slowly build up again to who knows what amount. So basically, I have 2 choice, go all in and hopefully I can finish the rest, or leave with what I have and screw my credit and live with cash all my life. But either way, it's my personal problem, only here for inquiries on credit card bullshit.

And my CC is from the bank, so I'm pretty sure it's not insecure like those small credit card companies.

[RFlush]

Originally Posted by aznlangjai

What went up YOUR ass? I thought I'd be the one fustrated about my debt and yet you're here more fustrated about my owing more than me.

Obviously I have no clue about money management, that is why I'm here asking for advice, need to be anymore obvious, captain?

I'm in a situation that you don't even understand so if you have nothing helpful to say, why don't you go post in the fight club, since it seems that's where you belong.



As far as I know, no one explained anything in this thread as to how interest work. And not everyone has mommy and daddy to help like you do, as for some, do grew up independently and no one to teach us these things.

Anymore insults to my childhood and personal lifestyle are welcome.

I have money in cash for half maybe 2/3 of what I owe, problem is, if I use all the money to pay off my credit card, I don't know if I can keep up with the remaining balance. If I pay off 2/3 of it, I might not be able to pay of the other 1/3, then interest will slowly build up again to who knows what amount. So basically, I have 2 choice, go all in and hopefully I can finish the rest, or leave with what I have and screw my credit and live with cash all my life. But either way, it's my personal problem, only here for inquiries on credit card bullshit.

And my CC is from the bank, so I'm pretty sure it's not insecure like those small credit card companies.

Because you said: "Anymore insults to my childhood and personal lifestyle are welcome." I will take you up on that offer.

You don't need mommy and daddy to help educated simple matters. Do you need them to teach you how to read a contract as well? Why would you sign for something without reading it first? Oh wait, your mommy and daddy never told you that so you did not know.

There has been numerous advice, mostly repeating, on what to do in your situation. Yet you are too dumb to listen (maybe mommy and daddy didn't help you with reading comprehension).

You can either declare bankruptcy and be screwed for 7 years and always have the note on your record stating you declared bankruptcy. Or, like many others have stated, pay off your debt. Don't even look at the minimum balance, just pay off whatever you can with all your savings. Interest is cumulative, meaning you get interests on interest. So paying off a lump sum is better than paying off little by little later on.

Do you understand now? Or do you need someone to read it for you? It seems like you don't have a clue what to do, and when people suggest something, you repeat the question you asked even though the answer is in front of you.

Is our education system really that poor?

[mr_chin]

Originally Posted by RFlush

Because you said: "Anymore insults to my childhood and personal lifestyle are welcome." I will take you up on that offer.

You don't need mommy and daddy to help educated simple matters. Do you need them to teach you how to read a contract as well? Why would you sign for something without reading it first? Oh wait, your mommy and daddy never told you that so you did not know.

There has been numerous advice, mostly repeating, on what to do in your situation. Yet you are too dumb to listen (maybe mommy and daddy didn't help you with reading comprehension).

You can either declare bankruptcy and be screwed for 7 years and always have the note on your record stating you declared bankruptcy. Or, like many others have stated, pay off your debt. Don't even look at the minimum balance, just pay off whatever you can with all your savings. Interest is cumulative, meaning you get interests on interest. So paying off a lump sum is better than paying off little by little later on.

Do you understand now? Or do you need someone to read it for you? It seems like you don't have a clue what to do, and when people suggest something, you repeat the question you asked even though the answer is in front of you.

Is our education system really that poor?

The mommy and daddy is not towards you. GTR R34 suggests that I suck it up and ask mommy and daddy. You should learn to read quotes and replies.

I've noted all the advice, and later asked about how interest works... maybe you should scroll back up and read before posting like you were here since the beginning. Don't come storming in here thinking you have advice so you have the right to call people dumb, you're just as dumb for not knowing what is going on.

You said: You don't need mommy and daddy to help educated simple matters. Then you said: maybe mommy and daddy didn't help you with reading comprehension. So do I need mommy and daddy to educate me or not, you have no clue what you're talking about.

<--- Fight club is that way.

[nipples]

since no one is answering his interest question, i'll weigh in:

let's say you owe $2000 flat on a credit card with a 19.5% interest (i think this is the highest there is right?)

so 19.5% is calculated per year, and each month the interest would be 1.625%.

now, if you pay your balance in full on the due date, you owe nothing. ie. that's their grace period. so it's like borrowing money for free.

if you don't pay a dime on it, this is what you would owe:
1st bill after grace period: $2000 + 1.625% interest = $2032.5 interest = $32.5
2nd bill after grace period: $2032.5 + 1.625% interest = 2065.53, interest = $33.03
3rd: $2065.53 + 1.625% interest = $2099.09 where your interest this month is $33.56

so here, you can already see that each month, the interest part of the payment is getting larger and larger.
so if you were to not make a payment for say 2 years, you'll owe almost 3000. after 7years of non-payment status you will owe $7745.99!!

this is why the first thing that needs to be done when you go see a credit counselor is to have them put a stop to the interest.

if yo uwant to play with the numbers yourself use this formula:

A = S * (1+ i/n)^Y*n)
A=amount you will owe
S=starting balance ..like whatever your balance is now
i= interest rate (eg 19.5% = 0.195)
n=12 = number of times compounded...i believe it's per month for purchases and per week? day? for cash advances
Y=number of years

so that
A = 2000 * ( 1 + 0.195/12)^ 7x12 for 7years
A= 2000 * (1.01625) ^84 = 2000 * 3.87 = about $7745.

and you need to act quick, because the credit card company wont wait for you...they're more than happy to tack on more interest.

[mr_chin]

Originally Posted by nipples

since no one is answering his interest question, i'll weigh in:

let's say you owe $2000 flat on a credit card with a 19.5% interest (i think this is the highest there is right?)

so 19.5% is calculated per year, and each month the interest would be 1.625%.

now, if you pay your balance in full on the due date, you owe nothing. ie. that's their grace period. so it's like borrowing money for free.

if you don't pay a dime on it, this is what you would owe:
1st bill after grace period: $2000 + 1.625% interest = $2032.5 interest = $32.5
2nd bill after grace period: $2032.5 + 1.625% interest = 2065.53, interest = $33.03
3rd: $2065.53 + 1.625% interest = $2099.09 where your interest this month is $33.56

so here, you can already see that each month, the interest part of the payment is getting larger and larger.
so if you were to not make a payment for say 2 years, you'll owe almost 3000. after 7years of non-payment status you will owe $7745.99!!

this is why the first thing that needs to be done when you go see a credit counselor is to have them put a stop to the interest.

if yo uwant to play with the numbers yourself use this formula:

A = S * (1+ i/n)^Y*n)
A=amount you will owe
S=starting balance ..like whatever your balance is now
i= interest rate (eg 19.5% = 0.195)
n=12 = number of times compounded...i believe it's per month for purchases and per week? day? for cash advances
Y=number of years

so that
A = 2000 * ( 1 + 0.195/12)^ 7x12 for 7years
A= 2000 * (1.01625) ^84 = 2000 * 3.87 = about $7745.

and you need to act quick, because the credit card company wont wait for you...they're more than happy to tack on more interest.

Thank you very very much. That is exactly what I needed about interests.

[BNR32_Coupe]

I think anyone with financial problems just has a discipline issue. Everybody should be able to survive debt-free, whether you're a McDonalds worker in Surrey making $8/hr, or in senior management making $180k/year. Either ends of the spectrum has their shares of people with financial issues. Going broke is really just a combination of wanting more than you're worth and a lack of discipline.

Declaring bankruptcy should be a last resort. Remember that both the senior manager and the mcdonalds worker, like you, both need to make sacrifices in order to sustain their financial standing. The senior manager would have to stop taking trips to europe and asia every 6 months, and the mcdonalds worker has to stop whatever wasteful spending minimum wage people do. I think the #1 problem most people aged 20 - 40 face is eating out every day. Food is something we all need, but eating out everyday is wasteful spending. Keep that stuff as a "sometimes" thing, not an everyday necessity. A $7.50 meal at McDonalds takes away the hunger for a few hours but for the same price for food at superstore, you can eat 3 good meals.

Are you one of those night-life clubber types? Why spend $100 on drinks to buy some conversation time from a hunnie when you can talk to them for free? Nobody knows this, but talking to girls is free, all you is some confidence.

Since we're on RS you're probably into modding cars. Stop doing that. If you have a car that's worth $5k, and you're $3k in debt, sell your car to pay off the debt and get one that's worth $2k. If you're hesitant about doing this because you bought the car for almost 3x what you're selling it for now, don't complain because this happens to every person that sells their car. Cars are a consumable item, they're not like housing property or investments. Get the $2k beater civic, at least you're debt free now and won't have to declare bankruptcy with 0 credit for 7yrs.

Remember these things: If it don't make money, it don't make sense. Don't play the game if you can't afford it. Stop spending. Get another job, whether it's legit or not. Focus on paying the debt off rather than surviving everday, don't be lazy. Spending time on the couch or computer is wasteful spending - you're better off working during that free time.

[dubzz24]

I haven't read the whole thread, but I saw your post about just saving up and paying it off all at once.

Think again.

Being that I've worked in the financial services industry for 5 years now, I can tell you that it usually takes a credit card issuer 270 days without payment for them to "charge-off" your account. What that means is after 9 months without a payment the bank will cut their losses and sell your debt to a collections agency so it's out of the bank's hands. Once that happens, good luck getting a credit card with a limit over $500, an APR under 20%, or any other credit (unsecured or not) for a long time.

Keep paying the minimum and when you can afford to, pay a little more. If you're really in a tight spot, give the bank a call and explain the situation and see if there's anything they can do to help ex. deferred payments.

[unit]

better to start paying interest on 1/3rd today, than interest on the full amount...

[CORDV6]

May get totally flamed for this, but this is what i did when i was a student and hella broke.
As stupid as it may seem, i applied for a PC Mastercard which offered a 1.97% balance transfer for 6 months option. They gave me a $3000 grand limit which i then transferred my debt cc over. In less than 5 months i paid all this off, as interest on the bit was less than 5 bucks, compared to 50+.

Hope this helps, worked for me!

[RFlush]

Originally Posted by CORDV6

May get totally flamed for this, but this is what i did when i was a student and hella broke.
As stupid as it may seem, i applied for a PC Mastercard which offered a 1.97% balance transfer for 6 months option. They gave me a $3000 grand limit which i then transferred my debt cc over. In less than 5 months i paid all this off, as interest on the bit was less than 5 bucks, compared to 50+.

Hope this helps, worked for me!

Why would you get flamed? You researched on what you were suppose to do and you did it. It worked out good for you as it helped you pay off your debt faster.

Nothing wrong with that. Even get a thumbs up

[Gt-R R34]

Agreed witih ^

smart way of doing it.