Credit Card Minimums Fuel Growing Debt, Survey Finds

Travelers can still rely on travel credit cards for favorable exchange rates and rewards, but should carry a debit card as a backstop and keep funds in a dedicated travel account to avoid cash-only hiccups, a strategy that helps in places where cash is king. A LendingTree survey finds that around 41% of U.S. cardholders habitually pay only the minimum on at least one card, with the share rising to 58% among Gen Z, a pattern that can trap people in debt over time. Many cardholders also underestimate the importance of knowing their interest rates, with 44% saying they don’t know the rate on any card, which compounds the risk of carrying a balance. The typical credit card rate sits around 21%, and paying only the minimum can stretch purchases into years and cost thousands in interest, since minimum payments largely cover interest in the early months. Finance experts warn that the minimum payment is a debt maintenance strategy rather than a real payoff plan, emphasizing the need to pay more than the minimum to make meaningful progress toward reducing balances. Overall, a combination of prudent spending with informed payments—paying more than the minimum and monitoring interest rates—can help prevent the long-term drag of carrying a balance on multiple cards.