{"id":5075,"date":"2019-05-15T09:38:29","date_gmt":"2019-05-15T13:38:29","guid":{"rendered":"http:\/\/caissealliance.absoludev.ca\/?p=5075"},"modified":"2019-05-15T09:38:29","modified_gmt":"2019-05-15T13:38:29","slug":"the-cost-of-credit","status":"publish","type":"post","link":"https:\/\/www.caissealliance.com\/en\/personal\/loans-and-debts\/the-cost-of-credit\/","title":{"rendered":"The Cost of Credit"},"content":{"rendered":"
\n

There are countless borrowing opportunities, but there are a lot better things you can be doing with your money than pay interest.<\/p>\n<\/div>\n

The higher the interest rate, the more the loan will cost<\/h2>\n

The total cost of an item bought on credit depends on 3 things: the amount you borrow, the interest rate and the repayment term. That\u2019s why it\u2019s in your best interest to save up as much as you can toward it ahead of time: you reduce the amount you have to borrow and the length of time you make payments.<\/p>\n

Ideally, if you can pay cash when you buy a product or service, you\u2019ll enhance your peace of mind.<\/p>\n\n\n\n\n\n
Loan amount<\/strong><\/td>\nInterest rate<\/strong><\/td>\nLength of repayment term<\/strong><\/td>\nExtra amount paid in interest<\/strong><\/td>\n<\/tr>\n
\n

$2 000<\/p>\n<\/td>\n

\n

10<\/strong> %<\/p>\n<\/td>\n

Over 2 years<\/td>\n$215<\/strong> for a total of $2,215<\/strong><\/td>\n<\/tr>\n
\n

$2 000<\/p>\n<\/td>\n

\n

30<\/strong> %<\/p>\n<\/td>\n

Over 2 years<\/td>\n$683<\/strong> for a total of $2,683<\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

The longer the repayment term, the more the loan will cost<\/h2>\n

You might be tempted to spread your payments out over a longer period to reduce your payments, but it will cost you more in the long run. That\u2019s why it\u2019s in your best interest to borrow the smallest amount possible for the least amount of time possible.<\/p>\n\n\n\n\n\n
\n

Loan amount<\/strong><\/p>\n<\/td>\n

\n

Interest rate<\/strong><\/p>\n<\/td>\n

\n

Length of repayment term<\/strong><\/p>\n<\/td>\n

\n

Extra amount paid in interest<\/strong><\/p>\n<\/td>\n<\/tr>\n

\n

$2 000<\/p>\n<\/td>\n

\n

10 %<\/p>\n<\/td>\n

\n

Over\u00a02 ans<\/strong><\/p>\n<\/td>\n

\n

$215<\/strong>\u00a0for a total of $2 215<\/strong><\/p>\n<\/td>\n<\/tr>\n

\n

$2 000<\/p>\n<\/td>\n

\n

10 %<\/p>\n<\/td>\n

\n

Over\u00a04 ans<\/strong><\/p>\n<\/td>\n

\n

$435<\/strong>\u00a0for a total of $2 435<\/strong><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Note that these examples are calculated using monthly payments. Frequency of payments (e.g., weekly, bi-monthly, monthly, etc.) can also affect the total cost of the loan.<\/p>\n

Did you know?<\/h3>\n

To find out a credit card\u2019s daily interest rate, divide the annual interest rate by the number of days in the year. If your credit card\u2019s annual interest rate is 28%, for example, its daily interest rate is 0.0767%. This means that you pay $0.77 a day on an outstanding balance of $1,000.<\/p>\n","protected":false},"excerpt":{"rendered":"

There are countless borrowing opportunities, but there are a lot better things you can be doing with your money than pay interest. The total cost of an item bought on credit depends on 3 things: the amount you borrow, the interest rate and the repayment term. That\u2019s why it\u2019s in your best interest to save […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[108],"tags":[],"class_list":["post-5075","post","type-post","status-publish","format-standard","hentry","category-loans-and-debts"],"acf":[],"yoast_head":"\nThe Cost of Credit | Caisse Alliance<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.caissealliance.com\/en\/personal\/loans-and-debts\/the-cost-of-credit\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Cost of Credit | Caisse Alliance\" \/>\n<meta property=\"og:description\" content=\"There are countless borrowing opportunities, but there are a lot better things you can be doing with your money than pay interest. 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