The good news is I'm about to give you a little math lesson that will really motivate you to get out of credit card debt. The bad news is I'm about to give you a little math lesson (hehe). It'll show that you're paying a lot more in interest on the pieces of plastic in your pocket than you think. A LOT MORE!

My hope is that once you learn how much credit cards really cost, you'll focus on getting yourself out from under like never before. For example, you may think you're paying 14% on the plastic in your pocket, which is fairly typical these days.  Unfortunately, you're really paying 20.47% -- once you factor in taxes.

Taxes?! What do taxes have to do with it?
We spend 31.60% of our income on taxes! This budget-busting calculation comes from the non-partisan, non-profit Tax Foundation, which also reports that we worked from January 1 to April 26, 2006, just to cover the 50 or so taxes we're likely to pay this year. That's 116 days on nothing but taxes. Not a penny for food, clothing, or shelter – or for celebrating Tax Freedom Day. Ugh!

Since credit card interest isn&39;t tax deductible (and hasn't been since the late 1980's), we pay our credit card bills with "after-tax dollars" – the 68.40 cents out of every dollar that we can actually spend on something other than taxes.

The numbers are even more startling if your credit is less than ideal. For example, say you're rebuilding or establishing credit with a secured card that comes with a 19.50% APR. That 19.50% will really cost you 28.51%.

Did you make a late payment on another credit card or bill and now find yourself paying 30% on all your credit cards? It’s called universal default, and what looks like 30%, which is plenty bad enough, will really cost you a whopping 43.86%!

How much are you really paying?
The math is surprisingly simple. You divide the credit card interest rate by 100, minus your tax rate.

Credit Card Interest Rate
       100 - Tax Rate

Using the national tax rate average of 31.60%, you'd divide the interest rate by 68.40, as I did for these sample rates:

• 14.00% divided by 68.40 (100 - 31.60) = 20.47%
• 19.50% divided by 68.40 (100 – 31.60) = 28.51%
• 30.00% divided by 68.40 (100 – 31.60) = 43.86%

Evaluate the lesson
Does knowing the true cost of your credit cards inspire you to pay them off? Hope so! Did the math make your eyes cross? Hope not!