According to a Gallup poll, last year, the average Christmas spending among households with children younger than 18 living at home was $1,092. What if you were to put that amount on your credit card and pay minimum payments, how long would it take to pay it off and how much would you spend? Of course the interest rate is a key factor. Let’s look at two scenarios*. 15% rate on a credit card and 30% rate on a store card.
15% Credit Card
If your child is in 1st grade, it wouldn’t be paid off until they were in Jr. High at a total cost of about $1,500.
30% Credit Card
If your child is in 1st grade, it wouldn’t be paid off until they were in High School at a total cost of about $2,500.
*Minimum payment 4% of total and no lower than $15 per month