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Credit cards can be incredibly useful financial tools—but without the right habits, they can also create long-lasting financial stress. Senior Personal Banker Trish Rodriguez offers practical, real-life insight into how credit cards work, how to use them responsibly, and how to protect your financial future.

Understanding Interest Rates and Minimum Payments

Rodriguez explains that the biggest danger with credit cards is misunderstanding how interest and minimum payments work. “Only paying the minimum monthly payment on your credit card debt can quickly turn a manageable bill into a dangerous bill,” she says. Credit cards use compounding interest, which means interest added this month becomes part of the daily balance calculated for next month's interest. “The unpaid interest will keep building on itself.”

With average credit card interest rates between 20–30%, even a $1,000 balance can result in an interest charge of around $24.66 in one month—without reducing the principal. Rodriguez also notes the importance of taking advantage of grace periods. Visa credit cards include this helpful reminder in their disclosures: “We will not charge you interest on new purchases if you pay your entire balance in full by the due date of each month.”

She adds, “My grandmother used to tell me, ‘If we can’t afford it this month, how are we going to afford it next month when the bill comes?’” Strategic budgeting is one of the most effective ways to avoid falling into the interest trap.

Building Responsible Habits

“Credit cards are a great tool to help improve a credit score. They should not be used as a means to get what we want when we can’t afford it.” Rodriguez emphasizes that financial discipline always begins with budgeting. She knows firsthand how easy it is to fall behind—she and her husband once found themselves $23,000 in credit card debt, living paycheck to paycheck.

Their turning point came when they discovered the debt snowball method—a repayment strategy where you list all debts from smallest to largest, pay minimums on all but the smallest, and attack that smallest debt aggressively. Once paid off, you roll (“snowball”) that payment into tackling the next largest debt. “We had to force ourselves to be disciplined and keep a budget in order to use this debt snowball effectively. We were able to get out from under ALL of that debt in 3 years.”

Her advice is simple: “Even slow progress is still progress. Keep a budget. Live within your means. Celebrate every victory, even the little ones.”

After paying down high balances, Rodriguez stresses the importance of building a 3–6 month emergency fund so unexpected expenses don’t push you back into debt.

The Minimum Payment Trap

Rodriguez  warns that making only minimum payments extends your payoff timeline dramatically. “Purchases charged on a credit card could end up costing the consumer double or triple what the actual price was.” Because minimum payments are structured so most of the payment goes toward interest—not principal—debt can spiral quickly.

Choosing the Right Card

Selecting a credit card should never be rushed. Rodriguez recommends evaluating your credit score, spending habits, benefit preferences, terms, and fees. Trusted resources like Experian, Equifax, and TransUnion can help guide your decision.

Credit Cards as a Foundation for Your Financial Future

Used wisely, credit cards can build strong credit. Rodriguez reminds consumers to:

1. Keep balances below 30% of your limit.
2. Make every payment on time.
3. Pay more than the minimum.

“You work hard for your money—wouldn’t you rather keep it in your pocket than give it to the credit card company?”

With knowledge, discipline, and the right habits, a credit card can truly be a powerful financial friend—not a foe.

Member FDIC | This is for informational purposes only and does not constitute legal, tax, or other financial advice and the consumer should seek the advice of a financial advisor/professional, tax consultant, or legal counsel for their specific needs.