Compare the long-term costs of revolving credit against fixed-rate installment loans to find your fastest path to debt-free living.
Credit cards use revolving credit, where interest is calculated daily on your average balance. This structure can lead to a "minimum payment trap" where most of your payment goes toward interest rather than principal. Personal loans are installment credit with a fixed end date and typically lower interest rates, meaning every payment significantly reduces your balance until the debt is eliminated.