Did you make a late payment on your credit card recently? If so, you’re far from alone.
A new study from personal-finance website NerdWallet found that more than a quarter of Americans (26%) have made at least one credit card payment that was 30 or more days late, while 12% have made multiple delinquent payments.
Overall, the number of late credit-card payments has risen 22% since 2015, NerdWallet found. The site’s study was based on data from the Federal Reserve Bank of St. Louis and a survey of more than 2,000 consumers.
All of these late payments have come at a high cost. NerdWallet estimates that Americans have paid up to $3 billion in late fees on their credit cards.
It calculated this figure by multiplying the percentage of people who said they had made a late payment by the most recent population data from the U.S. Census Bureau and then multiplying that amount by the maximum fees credit-card companies charge for late payments ($28 for the first late payment, $39 for the second.)
Don’t miss: The Capital One hack exposes the dark side of racking up credit-card rewards
But that’s not the end of the higher costs that card holders will pay if they are delinquent on their accounts.
“Delinquent payments may also result in higher interest rates,” the report noted. Additionally, a late payment can lower one’s credit score, making it more difficult for them to qualify for lower-rate loans.
Americans prefer rewards over interest rates
NerdWallet’s report more broadly showed that many credit-card holders don’t have their priorities in order.
In the website’s survey, 1 in 3 respondents said rewards were the most important factor when choosing which credit card to apply for, even more than the interest rate (29%) or annual fee (19%).
Meanwhile, nearly half of card holders said they don’t pay off their balance in full every month. And nearly 2 in 5 people said they don’t know the interest rates on their credit cards. Consequently, many people are taking the wrong approach to credit cards.
Also see: Why it could get more difficult for Americans to get approved for a mortgage
“Get that balance down to zero before you focus on earning rewards,” Sara Rathner, NerdWallet’s credit-cards expert, said in the report. “When you carry a balance from month to month, you pay more in interest than you earn in rewards.”
Especially for consumers who may need to carry a balance on their cards, securing the lowest interest rate possible should be the priority rather than getting the most cash or points back for purchases.