Why I Always Pay My Credit Card in Full (and You Should Too)

Why You Should Always Pay Off Your Credit Card in Full

Carrying a credit card balance from month to month might not seem like a big deal—but it is.

1. Interest Adds Up Fast

When you don’t pay your full statement balance, your credit card company charges interest on what’s left, which adds up quickly. Most cards charge interest monthly, and some even calculate it daily.

As of mid-2023, the average interest rate on new credit cards was 24%, according to credit.com. That means even a modest balance can become significantly more expensive over time.

Here’s a demonstration of the expense of carrying a balance on a credit card. Let’s say I have a balance of $2,000 in January of 2025 and decide to only pay the minimum due each month until it’s paid off:

• Balance: $2,000

• Interest Rate: 24% APR

• Minimum Monthly Payment: $60

• Time to Pay Off: Over 15 years

• Total Interest Paid: More than $3,800

• Total Cost: Nearly $6,000 for that original $2,000 balance

2. A High Balance Can Hurt Your Credit Score

Your credit utilization—how much you owe compared to your available credit—is one of the biggest factors in your credit score. When you carry a balance, especially one that’s more than 30% of your limit, your score can take a hit. That matters if you’re applying for a mortgage, refinancing a loan, or even trying to rent an apartment.

Paying your balance in full every month keeps your utilization low and your score in good shape.

3. You Owe Before the Month Even Starts

When you don’t pay your credit card in full, you start the month already owing money. New charges pile on top of old ones, and it’s hard to know what you actually have available to spend.

That’s where people get off track—thinking they can afford something when they’re really just pushing the cost into the future.

Paying in full each month keeps your spending grounded in this month’s income.

If keeping track of your spending feels overwhelming—or if you’re not sure how to break the cycle of carrying a balance—emPowers can help. I work one-on-one with clients to untangle their finances, build clear monthly spending plans, and create systems that actually stick.