A tool designed to estimate the effects of making credit card payments every two weeks, instead of the standard monthly payment schedule. For example, if the minimum monthly payment is typically $100, this strategy involves paying $50 every two weeks. This method capitalizes on the accelerated payment principle, potentially reducing interest paid and shortening the repayment period.
Employing a more frequent payment schedule offers distinct advantages in managing credit card debt. By making half of the monthly payment biweekly, an additional full payment is effectively made each year. This leads to a faster reduction of the outstanding balance, significantly diminishing the accrued interest over the life of the debt. The historical approach to credit card repayment primarily involved single monthly installments; however, this alternative strategy leverages more frequent payments to expedite debt elimination and improve financial outcomes.
