Cumulative Interest

Following the payoff of a loan, you take a look at all of your statements. That $50,000 loan ended up costing you a good $5,600 in interest rate payments over the ten years it took you to pay off the loan.

That $5,600 is called cumulative interest. It’s every dollar that you paid to the financial institution over the duration of that amortization table.

Next time, pay cash up front (if you can).