Devin Thorpe, founder of the Your Mark on the World Center, calls himself a champion of social good. He writes about, advocates for and advises those who are doing good. He travels extensively to share his message as a keynote speaker, emcee and trainer. As a Forbes Contributor he covers social entrepreneurship and impact investing. His books on personal finance and crowdfunding draw on his entrepreneurial finance experience as an investment banker, CFO, treasurer, and mortgage broker helping people use financial resources to do good. Previously he worked on the U.S. Senate Banking committee staff and earned an MBA at Cornell.

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How borrowing money each month can quickly ruin your finances

It isn’t unusual for a family to come up a little short at the end of the month. How a family handles that situation may matter more than you think.

If your family comes up short by $100 every month and borrows that money on a credit card with 12% interest, the deficit in the second month will have grown to $101. The next month, the shortfall will have grown to a bit more than $102. Within a year, the shortfall will be $113. After two year years, $127 and after three years, $143. You’ll also have a new debt totaling $4,308 at the end of 36 months.

If you borrow the money on a more expensive credit card, say one with a 24% interest rate, after three years the monthly deficit will have grown to $204 per month. At the higher interest rate, your debt will have grown to $5,200.

This article first appeared at FamilyHow.com.  To read the rest of the article, click here.  A collection of my articles will soon be released as a book.

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