Survey Finds 40% of Americans Think Minimum Credit Card Payments Are Enough—Top Tips to Break Free from Debt Myths
If you have a credit card, you probably know that the bill offers a “minimum payment” amount. It may look tempting—especially if money feels tight—to just pay that smaller number and call it a day. But according to a recent Experian survey, 40% of Americans say they think making the minimum payment is enough to manage credit card debt. With U.S. card balances reaching a record $1.2 trillion and late payments on the rise, this myth could cost thousands in the long run. Let’s break down what minimum payments really mean, why only paying them can be risky, and smart ways to get ahead—without losing sleep.
What Minimum Payments Really Mean—and Why They’re a Trap
Credit card companies set a minimum payment—usually about 1% to 3% of your balance plus fees and interest. If you pay at least this amount every month, your account stays in good standing and you avoid late fees. But here’s the problem: Paying only the minimum can keep you in debt for decades and cost you far more than you realize.
“It’s a myth that paying the minimum does enough to get you out of debt,” says credit expert Bruce McClary. “It’ll keep you in debt much longer.”
Let’s look at some real numbers. According to NerdWallet, if you have the average U.S. revolving credit card debt—$10,563—and only make minimum payments, it could take you nearly 22 years to pay it off. During that time, you’d fork over more than $18,000 just in interest! That’s like buying another used car, all to pay off the same old debt.
This isn’t just a theoretical problem. Federal data shows that as of late 2024, over 10% of Americans are making only minimum payments—the highest share in 12 years. And the share of people falling behind (more than 30 days late) jumped over 10% year-over-year. When bills pile up and inflation makes everything pricier, it’s easy to see how people feel stretched. But the minimum payment option is built to keep you paying interest month after month, instead of clearing your debt.
Money tip: Avoid the debt trap by paying more than the minimum each month—even an extra $20 or $50 can save you hundreds in interest over time.
Next steps: Check your statement for a box that shows how long it’ll actually take to pay off your balance if you stick to minimums. Then, try to budget a little more each month. Even small changes add up!
Smart Ways to Pay Off Credit Cards Faster—Snowball vs. Avalanche
If credit card debt feels like a mountain, you’re not alone. Over 80% of Americans with credit card debt reported struggling to make ends meet in 2024, according to a recent survey. But you have options beyond the minimum payment. Two popular strategies are the snowball and the avalanche methods. They both help you pay off debt faster, but use different approaches.
The Snowball Method: List all your credit card debts from smallest to largest. Focus on paying off the smallest first (while still making at least the minimum on the others). Each time you clear a card, roll that payment into the next smallest debt—like a snowball getting bigger as it rolls downhill. People like this approach because it gives you “quick wins” and motivation as you see cards disappear from your list.
“Getting rid of that first balance can be a huge confidence boost,” says money coach Tanya Hughes. “You feel like you’re getting somewhere.”
The Avalanche Method: Here, you list your debts by interest rate, highest to lowest. Pay as much as you can on the card with the highest rate (again, while covering at least the minimums on others). When you knock out that card, move to the next highest rate. This method saves you the most money on interest, but you might not get those small quick wins if your highest-rate debt is also your biggest.
Money tip: Pick the method that fits your personality—do you need early wins (snowball), or are you focused on saving the most money (avalanche)? There’s no “wrong” answer as long as you’re making progress.
Next steps: Write down all your card debts, including balances, rates, and minimum payments. Decide which method fits you best. Set up automatic payments to chip away at your target card. Even if you can only add $25 extra per month, you’re moving in the right direction.
Busting Debt Myths: Credit Scores, Delinquencies, and Your Future
It’s easy to fall for common credit card myths. Some people worry that paying off cards quickly will hurt their credit score or that carrying a balance is “good” for your score. Let’s clear these up with facts.
First myth: You must carry a balance to build credit. False! In reality, you build credit by using your cards responsibly and paying them off on time each month. You do not need to owe money month after month for your score to rise.
“You don’t have to be in debt to have good credit,” says credit educator Rod Griffin. “Payment history is the biggest factor, not carrying a balance.”
Second myth: Only paying the minimum keeps your account healthy. Yes, you avoid late fees, but your credit utilization—the percentage of your available credit you’re using—stays higher for longer, which could lower your score over time. Lenders like to see balances under 30% of your limit, and lower is usually better.
Right now, more people are falling behind: the percentage of credit card balances 30+ days overdue jumped to 3.52% recently, up from 3.21% a year earlier. Missed minimum payments can quickly snowball into late fees, penalty rates, and credit damage. According to the New York Fed, 14.6% of people expect to miss a minimum debt payment in the next three months—the highest worry since early pandemic times.
Money tip: Set up reminders, calendar alerts, or auto-pay to never miss a payment—even the minimum—while you work towards bigger payments.
Next steps: Log into your card account and set up an automatic payment at least for the minimum. Then, if possible, add a “top-off” payment mid-month to lower your balance further. Keep an eye on your credit score using free tools from your bank or apps, so you can spot progress and head off any problems early.
Take Charge: Simple Steps to Get Out of Debt Faster
Managing credit card debt may feel overwhelming, especially with prices rising and paychecks sometimes stretched thin. But breaking free starts with small, steady actions. The main lesson? Paying more than the minimum is your shortcut to savings and freedom. Use debt payoff strategies, automate payments when you can, and don’t get discouraged by setbacks.
“Even $20 extra a month makes a difference over time. It’s about progress, not perfection,” says personal finance writer Lisa Tran.
Consider finding places in your budget for small cuts, like dining out less or cancelling unused subscriptions, and redirect that money to pay down cards. If things feel out of control, call your credit card company and ask for a lower interest rate or hardship assistance. Many companies offer programs to help you get back on track—a phone call could save you hundreds or even thousands.
Get support by sharing your goal with a friend or family member, or use free online budgeting tools to track your progress. Remember, being informed is half the battle. By understanding the true cost of minimum payments and knowing there are proven ways to get ahead, you’re already taking control.
Next steps: Review your spending this week and commit to one extra payment above the minimum. Celebrate small wins—they add up and keep you moving forward. Your future self will thank you.