Credit cards and interest
Training 475 minutescredit card debt
You are a shop assistant with a $3,000 bank loan at 10% a month. $300 a month goes to interest alone, over 200% a year. Find the money and close it.
Training goal: Pay off the bank loan
▶ Play this trainingWhat you will learn
- A monthly rate looks small: 10% a month is over 200% a year.
- Spare money goes to the most expensive debt first.
- A closed loan gives its payment back to your month for good.
Your real-life step
Look up the yearly rate of every debt you have. Anything above 30% is a fire, put it out first.
Questions and answers
Why does credit card debt grow so fast?
Interest is charged monthly on the balance, including past interest. The minimum payment barely touches the debt.
How do I pay off a credit card faster?
Pay more than the minimum, stop adding new purchases and send every spare dollar to the dearest debt.
What is a grace period?
A window with no interest if you repay the full balance on time. Miss it and interest applies to the whole period.
More trainings in this module
- Good debt vs bad debt
- APR explained
- Credit score
- How to build credit
- How to get out of debt
- Clearing debts: the snowball
Numbers are illustrative. A game, not financial advice.