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Here’s how much credit card debt costs this fall
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If you’re trying to pay off your credit card debt, you’re likely aware that this type of debt has gotten a lot more expensive over the last couple of years. One issue is that interest rates have been climbing with the average credit card rate now hovering near 23%. Inflation has also had a big impact on how far your paycheck will stretch, so as the economic pressures mount, you may be struggling to keep up with the cost of your high-rate card debt.
At its core, credit card debt is expensive because of compound interest — the process by which interest is calculated not just on the principal balance, but also on accumulated interest from previous periods. Credit card interest charges alone can turn a manageable sum into an overwhelming financial burden in a matter of months. High interest rates simply exacerbate this issue, making it easy for this type of debt to spiral out of control.
The structure of credit card payments is also designed to keep consumers in debt for extended periods. The minimum payments often cover little more than the interest accrued, leaving the principal balance largely untouched and making your card debt even more costly. But how much does your credit card debt cost this fall? Below, we’ll explain what you should know.
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How much does credit card debt cost this fall?
The average cardholder is carrying about $8,000 in credit card debt currently, and the credit card interest rate currently stands at 22.76% — a record high. This high rate translates into significant costs for those carrying balances on their credit cards.
Let’s break down the costs for various debt amounts for different minimum payment structures:
$8,000 in credit card debt
1% of the balance plus interest:
- Monthly payment: Starts at $233.33 and decreases over time
- Total interest paid: $14,679.29
- Time to pay off: About 330 months
2.5% of your balance
- Monthly payment: Starts at $200 and decreases over time
- Total interest paid: $24,863.15
- Time to pay off: About 520 months
5% of the balance
- Monthly payment: Starts at $400 and decreases over time
- Total interest paid: $4,868.44
- Time to pay off: About 131 months
$10,000 in credit card debt
1% of the balance plus interest:
- Monthly payment: Starts at $291.67 and decreases over time
- Total interest paid: $18,512.11
- Time to pay off: About 352 months
2.5% of your balance
- Monthly payment: Starts at $250 and decreases over time
- Total interest paid: $31,435.33
- Time to pay off: About 558 months
5% of the balance
- Monthly payment: Starts at $500 and decreases over time
- Total interest paid: $6,111.59
- Time to pay off: About 138 months
$15,000 in credit card debt
1% of the balance plus interest
- Monthly payment: Starts at $437.50 and decreases over time
- Total interest paid: $28,095.54
- Time to pay off: About 392 months
2.5% of your balance
- Monthly payment: Starts at $375 and decreases over time
- Total interest paid: $47,863.51
- Time to pay off: About 627 months
5% of the balance
- Monthly payment: Starts at $750 and decreases over time
- Total interest paid: $9,219.91
- Time to pay off: About 151 months
These calculations assume that no additional charges are made to the card and that the stated minimum payments are made each month. It’s crucial to note that making only minimum payments, especially at the 1% or 2.5% level, can extend the repayment period significantly, potentially more than doubling the original borrowed amount over time.
Explore the credit card debt relief options that could help you here.
How to reduce your credit card debt costs
There are several strategies you can use to help reduce the cost of credit card debt:
- Debt consolidation: Consolidating your debt involves taking out a new loan to pay off multiple credit card debts. The new loan typically has a lower interest rate, which can save you money over time.
- Balance transfer: Many credit cards offer promotional 0% APR periods on balance transfers. By transferring high-interest debt to this type of card you can avoid interest charges for a set period, typically 12-18 months. That can provide significant savings and help you pay down the principal faster.
- Debt settlement: This strategy involves negotiating with creditors to pay less than what you owe, typically with the help of a debt relief company. If successful, this strategy can reduce your overall debt, lowering it by 30% to 50% on average.
- Debt management: With a debt management plan, the credit counselor you work with may help with negotiating lower interest rates with your creditors and creating a structured repayment plan. Lowering your interest rate could result in significant savings on interest over time.
The bottom line
Given today’s high average credit card rate, any balance you carry from month to month is likely costing you a lot of money in interest. And, those costs can grow over time as the charges compound, so it’s important to try and tackle what you owe as soon as possible. Otherwise, you could find yourself in serious financial trouble as your credit card debt obligations grow — making it even more difficult to get your finances back on track.
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Anna Sorokin, convicted con artist, appears on “Dancing With the Stars” wearing glittery ankle monitor
Los Angeles — Convicted con artist Anna Sorokin has hit the dancefloor on “Dancing With the Stars” with a featherweight – and very sparkly – ankle monitor.
The so-called “fake heiress,” who was convicted of swindling banks, hotels and friends in 2019 after falsely building a reputation as a wealthy German heiress named Anna Delvey, debuted the ballroom-worthy ankle monitor during the premiere of “Dancing With the Stars'” new season Tuesday night.
“It’s actually not a big issue at all. It’s pretty light and I asked them to make it tight so it doesn’t dangle. So it’s not so bad,” she told The Associated Press after the premiere. She and dance pro Ezra Sosa performed a routine set to Sabrina Carpenter’s “Espresso.”
“It’s the real star of the show, let’s be honest here,” Sosa said of Sorokin’s bedazzled ankle monitor.
“I think it’s kind of funny how people like – it’s not like an ankle weight,” Sosa said. “It’s not like 20 pounds. It’s like literally less than a pound and it’s not a big deal.”
John Carucci / AP
Sorokin acknowledged her debut didn’t go as planned.
“I feel relieved that it’s over,” she said. “I feel like my dance could have been a little bit better, but I’m happy I’ve done this and it was a great experience all over.”
Sorokin said she hopes viewers will be somewhat forgiving despite her criminal history.
“Hopefully people will give me, will give me a chance to show what I can do. And I served my time and I repaid my restitution,” she said.
Early reviews from fans weren’t positive, with the phrase “Anna Delvey’s Lackluster DWTS Debut” among those trending on the social media site X.
While she was released from prison in February 2021, immigration authorities picked her up shortly after she got out, claiming she overstayed her visa and must be returned to her native Germany. The “Inventing Anna” inspiration was in ICE custody for over a year before a judge cleared the way for her to switch to home confinement in October 2022 while she fights deportation.
Her release terms had to be amended to allow her to travel from New York to Los Angeles for filming.
While on home confinement, Sorokin has also gotten involved with a podcast and reality show.
Tupperware and some of its subsidiaries filed for Chapter 11 bankruptcy protection, the once-iconic food container maker said in a statement late Tuesday.
The company has suffered from dwindling sales following a surprise surge during the COVID-19 pandemic, when legions of people stuck at home tried their hands at cooking, which increased demand for Tupperware’s colorful plastic containers with flexible airtight seals.
A post-pandemic rise in costs of raw materials and shipping, along with higher wages, also hurt Tupperware’s bottom line.
Last year, it warned of “substantial doubt” about its ability to keep operating in light of its poor financial position.
“Over the last several years, the Company’s financial position has been severely impacted by the challenging macroeconomic environment,” president and CEO Laurie Ann Goldman said in a statement announcing the bankruptcy filing.
“As a result, we explored numerous strategic options and determined this is the best path forward,” Goldman said.
The company said it would seek court approval for a sale process for the business to protect its brand and “further advance Tupperware’s transformation into a digital-first, technology-led company.”
The Orlando, Florida-based firm said it would also seek approval to continue operating during the bankruptcy proceedings and would continue to pay its employees and suppliers.
“We plan to continue serving our valued customers with the high-quality products they love and trust throughout this process,” Goldman said.
The firm’s shares were trading at $0.5099 Monday, well down from $2.55 in December last year.
Tupperware said it had implemented a strategic plan to modernize its operations and drive efficiencies to ignite growth following the appointment of a new management team last year.
“The Company has made significant progress and intends to continue this important transformation work.”
In its filing with the U.S. Bankruptcy Court for the District of Delaware, Tupperware listed assets of between $500 million and $1 billion and liabilities of between $1 billion and $10 billion.
The filing also said it had between 50,000 and 100,000 creditors.
Tupperware lost popularity with consumers in recent years and an initiative to gain distribution through big-box chain Target failed to reverse its fortunes.
The company’s roots date to 1946, when chemist Earl Tupper “had a spark of inspiration while creating molds at a plastics factory shortly after the Great Depression,” according to Tupperware’s website.
“If he could design an airtight seal for plastic storage containers, like those on a paint can, he could help war-weary families save money on costly food waste.”
Over time, Tupper’s containers became popular that many people referred to any plastic food container as Tupperware. And people even threw “Tupperware parties” in their homes to sell the containers to friends and neighbors.
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