Filed under → The Real Price Tag
That is not the price. This is the price.
Buy something you have no business buying. Put it on a credit card. Then pay exactly what the statement asks for, every month, like a responsible person. The minimum payment is not a payment plan. It is a subscription to the thing you already bought.
Paying only the minimum, every month, until it is gone.
180 payments. The vacation lasted a week.
Here is the part that costs you nothing to fix.
The minimum shrinks as the balance does, which is exactly why it takes so long: the payment runs away from you at the same speed you chase it. So do one thing. Pick a payment and never let it drop. You do not have to find extra money for this to work.
So you pay, every month
$174
Flat. Same number every month until it hits zero.
And you are out of it in 2 years 8 months instead of 15 years. That is 12.3 years of your life back.
- Minimum only
- $10,745
- Flat payment
- $5,501
That is your $6,745 of interest, paid into an index fund month by month instead of to the card, at a 10% average.
See what waiting costs you too →The balance, both ways.
The math, in the open
The minimum payment. Most US card issuers set it as 1% of the balance + that month’s interest, with a floor of about $35. That is the formula here. It is the reason a minimum payment feels reasonable and behaves like a trap: it always covers the interest and chips off exactly 1% of what you owe, so the balance falls geometrically and the payment falls with it.
Interest. Charged monthly at one twelfth of the APR on the balance at the start of the month. Real cards compound daily and the difference is small, a bit more interest than shown here, not less.
Sanity check you can look up. $5,000 at 24% on minimum payments comes out to 16 years 9 months and $13,442 paid. That is the number that shows up in every consumer finance article, and this model reproduces it.
The flat payment. Your first minimum payment, rounded up, plus whatever you add. It never changes. Because the first minimum is the largest one you will ever be asked for, simply refusing to let the payment shrink is enough to pay the thing off years earlier, which is what the zero setting on that slider shows.
The index fund line. Each month’s interest, invested the month you paid it, growing at 10% a year compounded monthly until the debt would have been gone. 10% is roughly the long run S&P 500 average before inflation. It is an average, not a promise.
What is not in here. No annual fees, late fees, penalty APRs, promotional 0% periods, balance transfers, or new spending on the card. Every one of those makes real life worse than this page, except the last two, which are the only two you control. And this models revolving credit. A car loan or a student loan has a fixed term and a fixed payment, so it cannot stretch like this. That is the single biggest reason a card balance is more dangerous than a loan of the same size.
Show me the numbers
Where the balance sits at the end of each year, and what you have handed over by then.
| Year | Balance, min only | Paid so far | Of which interest | Balance, flat |
|---|