The importance of interest rates
Credit cards are very convenient when it comes to buying things you need. They offer rewards, protection from fraud, and credit history building.
Cards are also a major borrowing tool for many people. More than 50% of people in the US carry card balances for 10-15 years, occasionally or regularly, to cover ongoing or unexpected expenses.
Cards may seem an inexpensive option to choose. On a $5,000 unpaid balance you would be charged around $150 a month, which doesn’t sound too bad.
But the true cost of cards is very high if you carry balances. One way to better understand those costs is to look at how much interest you pay over longer periods of times.
Cards are also a major borrowing tool for many people. More than 50% of people in the US carry card balances for 10-15 years, occasionally or regularly, to cover ongoing or unexpected expenses.
Cards may seem an inexpensive option to choose. On a $5,000 unpaid balance you would be charged around $150 a month, which doesn’t sound too bad.
But the true cost of cards is very high if you carry balances. One way to better understand those costs is to look at how much interest you pay over longer periods of times.
Back to the basics
On a $5,000 balance with a 24% interest rate (average rates are around 20% now) you’d pay a whopping $9,332 in interest if you just pay the minimum payments every month :(
Things would look better if you keep paying the fixed amount you started with ($150) every month. The interest would be $3,322. Even so, that’s not an amount you can afford to ignore.
What if the APR was 14%? The interest would go down to $5,333 with minimum payment and $1,369 with a fixed $150 payment respectively. Doesn’t this make a lot more sense now?
Things would look better if you keep paying the fixed amount you started with ($150) every month. The interest would be $3,322. Even so, that’s not an amount you can afford to ignore.
What if the APR was 14%? The interest would go down to $5,333 with minimum payment and $1,369 with a fixed $150 payment respectively. Doesn’t this make a lot more sense now?
APR is the most important credit card cost parameter for cards that have even occasional balances.
Lowering APR on the cards you’re already using is hard. Negotiating with a bank is often fruitless. Consolidating card debt through personal loans or other credit cards is a hassle. You’d also better stop using the current cards, prevent new debt and be ready to loose the flexibility of monthly payments. For most people who don’t need credit repair services those options are not very appealing.
A better way
Gauss offers a better way. It lowers APR on the cards you use. Gauss automatically transfers unpaid balances with high APR to a low APR credit line that it provides. There’s no fees, so you never lose money with Gauss. Even if only part of the balances is transferred, you start saving money on the transferred portion right away.
Think of Gauss as a fully automated, no fees protection from high interest charges on cards. Everyone who has credit cards should use Gauss - it costs nothing, and it saves money when high interest charges are about to hit your cards.
Gauss takes less than 10 minutes to setup, including the transfer of balances you might already have. It’s better to setup Gauss as early as possible, so that it can start guarding your cards ASAP.
Gauss was designed to be affordable to everyone at no charge. Start using Gauss today! Download the app now.
Think of Gauss as a fully automated, no fees protection from high interest charges on cards. Everyone who has credit cards should use Gauss - it costs nothing, and it saves money when high interest charges are about to hit your cards.
Gauss takes less than 10 minutes to setup, including the transfer of balances you might already have. It’s better to setup Gauss as early as possible, so that it can start guarding your cards ASAP.
Gauss was designed to be affordable to everyone at no charge. Start using Gauss today! Download the app now.
June, 3 / 2022
Team Gauss
Team Gauss
Placid Inc.
200 Vesey Street, 24th Floor, New York, NY 10281
(877) 909-1559
Copyright 2022. All rights reserved.
200 Vesey Street, 24th Floor, New York, NY 10281
(877) 909-1559
Copyright 2022. All rights reserved.