Want to see something really scary? Are you really ready for this?
I mean, you have to have slept well and eaten enough before you see this so you are really prepared.
CREDIT CARD STATEMENT
Here it is – read your credit card statement!
Most people just look at the amount they owe for the month and just pay that, or not.
What is really interesting is all of the fees that go on the bill even if you aren’t late on your payment.
Pull one of your credit card statements out and take a look.
You will see how much of your payment goes to the principle (the amount you owe) and how much goes to the interest on the credit card.
Now get this, I have seen a credit card payment where the interest rates were so high that all of the monthly payment went to interest only AND the person was still $2 short of paying all the interest that had been put on the card for that month!
HOW TO LOOK AT YOUR STATEMENT
When you look at your statement, you will see a “Finance Charge”. That’s the interest rate that you pay that month.
On a payment of $110.00, you might see a finance charge of $73.00. That means, out of the $110.00 you paid that month, only $37 goes to the principle of the debt. The rest is interest charges.
Scary, isn’t it!