Repeat after me. “I will pay off my credit card every month. I will pay off my credit card every month….”


The population of the United States is 331 million. How many credit card accounts are there? 506 million!

The average American carries $6,194 in credit card debt…. But only 45% of Americans carry credit card balances. That means that of the Americans who do have credit card debt, its really probably closer to a $12,000 debt average.

I understand that some people have seemingly no choice but to accrue debt. If that is you, I sympathize and would love to talk to you about alternatives.

But here is what makes me want to scream…

I regularly talk to individuals who have $50,000+ of cash in the bank who still carry thousands of dollars of credit card debt….

Like… huh?

If this describes you, you really need to pay off your credit cards every month:

Credit cards generally charge around 20% interest.

Ooo. Those cute shoes are on sale – I’ll slide the card!

Well, that $50.00 purchase suddenly got a lot more expensive if you don’t pay it off right away.

Let’s look at this example:

You have $10,000 of credit card debt. You make the minimum payment. (In this example, the minimum payment starts at $400 and decreases with the balances).

It could take you about 14 years to pay off that debt, and you will have paid around $7,000 additional in interest over that time.

Why would you chain yourself to a card and monthly bill for 14 years? If you have the cash, PAY. OFF. YOUR. CREDIT. CARD. DEBT.

That cash sitting in the bank is earning you nothing. There is no point in letting it set there while your credit card interest accrues.

Yes, I understand you need to have an emergency fund. However, if you pay off your credit card balances, you will have room on your cards again to pay for those said emergencies. The end goal would be to have your cards paid off and then build an emergency fund large enough to cover 3 – 6 months of living expenses.

Do not go into retirement with credit card debt.

Please please don’t retire with credit card debt. If you need to work an extra year to pay it off, do it. If you need to shred your credit cards, do it. If you need to take a side job, do it. If you need to sell a kidney… well, maybe don’t do that. Just avoid it if at all possible.

There is no way your investment portfolio can achieve a 20% return in retirement. Your credit card debt will eat away the growth of your portfolio if you don’t get it taken care of now.


Note, I am not saying that credit cards are bad. I use one regularly. I love that it earns me rewards, makes my purchases more secure, can track my spending, etc. Although, there was that time I missed a payment…