Thousands wasted on credit card minimums
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Nearly one in 10 credit card customers pay off only the minimum payment each month, potentially costing them a fortune in interest, according to a survey from comparison website Moneysupermarket.com.
If the survey results were replicated across the population, it would mean that up to three million adults simply pay the minimum monthly credit card payment.
It would take someone paying the monthly minimum on £1,000 borrowed at 18.13 per cent APR 17 years to repay their debt. The amount of interest they would pay is £1,113, meaning they end up paying back more than double the original sum borrowed.
"Our research reveals credit cards are still playing an important role in the nation's finances, but in the current climate, it's more important than ever for consumers to understand the cheapest way to borrow on their cards and avoid getting stung by high interest rates," said Kevin Mountford from Moneysupermarket.com.
"Credit cards are not designed for long-term lending and anyone with an outstanding balance on their card should consider switching to a product offering 0 per cent interest on balance transfers."
The Moneysupermarket.com research also found that the average length of time debt was left on a credit card is 21 months.
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