Consumer Mathematics

I am using a credit card balance of $15,000 for this exercise with an APR of 18% for three years, I would have to make payments of $542.29 to pay off this amount. Suppose I make monthly payments of $625.00 on a credit card balance of $15,000, because I want to pay it off early, if I have an APR of 18% it will take me approximately 2.50 years to pay off my balance.

I think if used correctly credit cards can be a wise way to pay for things. As long as they are used within your means they can be helpful. But I don’t think they are necessary, it is quite easy to go past your means when you have a credit cards to pay for things. Unforeseen expenses would be just one thing to keep one from paying extra on their credit cards. It would make me feel financially secure to be able to a credit card debt early, but it’s hard to do that with all the expenses you don’t see coming. Most of my financial responsibilities are things that I can’t give up, which is why I don’t have credit cards.

Supposing I invest $100.00 that compounds interest 12 times per year that grows for 20 years with a yearly interest rate of 4.50% percent, at the end of the 20 years I will have $24,107.87 in my account.   Now supposing I invest $100.00 later in life it still compounds interest 12 times per year but it only grows for 10 years with an interest rate of 4.50%, at the end of the 10 years I will have $12,026.81.

It is smart to start saving earlier in life, but I would have to give up some things that I like to buy for myself and invest this money. I would have to give up things like going out and things like eating out to be able to start saving now. Later in life I’d hope to be more financially where I can afford to invest money without having to give things up. It would mean that my quality of life would improve if I had a little extra money to spend when I retire. It would mean a lot to me to have money saved when I would retire, it would bring me a great feeling of being financially...