If you pay the statement in full, you generally don't pay interest at all. If you carry a balance, the card charges you for the privilege — and the charge gets added to what you owe, so next period's charge is calculated on a bigger number. That's compounding, pointed the wrong direction.
Paid in Full Versus Carried
A credit card used and cleared each month is a payment tool. The same card with a balance left on it is a loan, and usually one of the most expensive loans a household has access to.
It's the same piece of plastic. The difference is entirely whether you clear it.
Why Minimum Payments Last So Long
A minimum payment is set to keep the account current, not to get you out. Most of an early minimum payment goes to the cost of carrying the balance rather than to the balance itself, so the amount you owe barely moves.
That's not a trick exactly — it's just what the structure does, and it surprises people who assumed paying something meant making progress.
Getting Out
Stop adding to it first; you can't bail out a boat that's still taking on water. Then pick a payoff order — smallest balance for morale, highest cost for efficiency — and keep paying more than the minimum.
If the balances are large relative to your income, talk to somebody before you make a move that affects your credit or your taxes.
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