A LendingTree survey revealed that 41% of U.S. credit card holders regularly make only the minimum payment on at least one of their cards. This figure rises to 58% among Gen Z users aged 18 to 29. While paying the minimum prevents late fees, it primarily covers interest rather than the principal balance, causing repayment to extend for years and increasing total costs significantly. Financial planner Corinna Rose warns that this habit maintains debt rather than reducing it, keeping accounts in good standing without meaningful progress toward payoff.

The average credit card balance for Americans with debt is $7,756, with an average APR of nearly 21%. At these levels, minimum payments could stretch repayment to almost 27 years and add around $13,000 in interest, according to Bankrate’s calculator. Experts emphasize that making only minimum payments can give a false sense of progress since interest accumulates daily. Nathan Sebesta of Access Wealth Strategies advises cardholders to pay down balances multiple times per month when possible to reduce interest expenses.

Experts recommend aiming to pay off credit card balances in full each month to avoid ongoing debt. Using credit cards as a convenient payment tool rather than borrowing money one doesn’t have helps maintain financial control. Regularly carrying a balance complicates tracking spending and signals the need to review budgets or reconsider credit card use. Rose advises against using future income to cover past expenses, stressing budgeting and financial awareness to prevent debt accumulation.

Missing minimum payments can lead to late fees and credit score damage if payments are 30 days overdue. Such late payments may reduce credit scores by 60 to 80 points and remain on reports for up to seven years. Sebesta recommends paying any missed minimums immediately and contacting issuers to possibly avoid credit reporting penalties. To prevent missed payments, setting up automatic pays is advised as a simple way to maintain on-time payment history and protect credit health.