Sanderson M. Smith
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This is simply an illustration of what can happen when you attempt to pay off credit card debts by small payments each month. Suppose you have $10,000 on your card, the annual rate is 18% (or 1.5% a month), and you make monthly payments of $200. Here's a two year schedule:
Month 
Payment ($) 
Interest Owed ($) 
Principle Repaid 
Principle Outstanding 
0 
0 


10,000.00 
1 
200 
0.00 
200.00 
9,800.00 
2 
200 
147.00 
53.00 
9,747.00 
3 
200 
146.21 
53.80 
9,693.21 
4 
200 
145.40 
54.60 
9,638.60 
5 
200 
144.28 
55.42 
9,583.18 
6 
200 
143.75 
56.25 
9,526.93 
7 
200 
142.90 
57.10 
9,469.83 
8 
200 
142.05 
57.95 
9,411.88 
9 
200 
141.18 
58.82 
9,353.06 
10 
200 
140.30 
59.70 
9,293.36 
11 
200 
139.40 
60.60 
9,232.76 
12 
200 
138.49 
61.51 
9,171.25 
13 
200 
137.57 
62.43 
9,108.82 
14 
200 
136.63 
63.37 
9,045.45 
15 
200 
135.68 
64.32 
8,981.13 
16 
200 
134.72 
65.28 
8,915.85 
17 
200 
133.74 
66.26 
8,849.58 
18 
200 
132.74 
67.26 
8,782.33 
19 
200 
131.73 
68.27 
8,714.06 
20 
200 
130.71 
69.29 
8,644.77 
21 
200 
129.67 
70.33 
8,574.45 
22 
200 
128.62 
71.38 
8,503.06 
23 
200 
127.55 
72.45 
8,430.61 
24 
200 
126.46 
73.54 
8,357.07 





TOTALS 
4,800 
3,157.07 
1,642.93 

After two years, you have paid a total of $4,800 in payments, you still owe $8,357.07, and you have paid $3,157.07 in interest (which is 31.57% of the amount you originally owed... and you aren't done yet!)
If you continue this table for two more years, you will find that at the end of four years,
$9,600.00 = your total payments.
$5,819.75 = interest you have paid (58% of what you originally charged).
$3,780.25 = amount of principle you have paid.
$6,219.75 = what you still owe (you haven't even paid off half of what you charged).
YIKE!
Moral of story: Use credit cards wisely.
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