| |
| |
|
WebsiteAlways |
|
Cutting Credit Card Costs
What are the APRs charged by the credit cards in your wallet? If you are paying more than 12% interest on any of them, you are probably paying too much. The prime rate is currently in the single digits, so credit card companies that charge above 13% APR are overcharging. If you have good credit, you should be able to find a credit card with an APR below 12%. Shop around and get the rate you deserve. Do not be afraid of asking for a lower rate on your current credit card if you think you deserve it. A lower interest rate can cut your credit card costs significantly. Another action you can take to save money is transferring your outstanding balances to a credit card with a low APR. Many credit card companies offer low APRs on balance transfers, and taking advantage of those offers can save you a lot of money. You need to make sure, however, that the special balance transfer rate is not temporary. Otherwise, you will need to transfer your balance again once the offer expires. You also need to find out if either credit card charges a fee for transferring a balance. The fee might be higher than the money you will save from the lower APR. Some credit card companies issue fees simply for holding their credit card, even if you do not have an outstanding balance (these are called inactivity fees). Close any accounts that currently charge you an annual fee. There are plenty of credit card companies out there that offer their services for free. Make sure to allow about one month between each credit card cancellation in order to prevent your credit score from dropping. Ask the credit card customer service employee to note on your credit report that the account was closed per customer's request. You also might want to consider paying your credit card debt with part of your savings. These days, banks only reward your savings account with less than or up to 1.5%, while your credit card charges you up to 21% in interest, so you will actually save more money by using your savings to pay your credit card than by leaving it in the savings account. If this is an option you are willing to consider, make certain that you do not drain your savings completely. It is recommended to maintain at least 3 to 6 months of income in your savings account in case of an emergency. Now that you are aware of which of your credit cards carry the highest interest rates, pay the most you can afford to those cards and pay a bit more than the minimum payment on ones that carry the lowest interest rates. Once you finish paying off the card with the highest interest rate, move on to the next highest, and so on until you pay off all your credit cards. This strategy will assist you in getting rid of the credit cards with the highest interest rates first, and leave you to handle the ones that do not charge you as much. You should discipline yourself to always pay more than the minimum required payment on any credit card. This can significantly reduce the time you spend in debt and the money you will pay in interest charges. Remember to always manage your credit card spending and do not over spend. It could end up costing you much more than you bargained for. The subject matter contained in our educational publications is for informational purposes only. We suggest that you consult your financial or other advisors when planning for your specific needs or requirements. Ana Ribero is a Certified Financial Counselor for Debt Management Credit Counseling Corp., a 501(c)(3) not-for-profit credit counseling organization.
MORE RESOURCES:
Credit - Google News |
|
|
|
RELATED ARTICLES
Credit Card Rates - Negotiating Rates with Your Credit Card Company Ok, let's face it, everybody hates high credit card rates, and they drain hard earned money out of your wallet. As a valued consumer, it is apparent that you learn how to negotiate to get the absolute best rate that you possibly can. 5 Killer Steps to avoid Credit Card SCAMS! In August, 2004, the Federal Trade Commission issued their findings of a recent study, which showed that nearly 25 million adults were victims of fraud.Now, most importantly, If you are a victim of fraud, please do not feel like you did anything wrong. Identity Theft - How to Protect Yourself "Like the tan? I got tons of sun on that Caribbean cruise. First class tickets to Florida and back! Nope, not an airline upgrade. 4 Steps to Creating Good Credit As a consumer you've learned the importance of establishing a good credit rating with your lenders. Whether you are shopping for a new home or auto, or searching for the best deals on insurance, your credit worthiness will be judged by your credit rating or credit score. All About Balance Transfers What is a balance transfer?A balance transfer can be explained simply as a balance transfer! When a balance is transferred usually from a credit card, but possible from a bank account or loan to a credit card with a offer interest rate (usually 0%) for a set period. It does not have to be the entire amount. Your Credit Card May Be Costing More Than You Think! Do you know what your credit card is truly costing you? Many people assume that they do, but aren't familiar with the hidden fees that many credit card companies are charging. In fact, if you don't keep close tabs on your credit card, you may end up paying hundreds of extra dollars per year-without ever really knowing it!And if you're trying to budget your money, those hidden fees can add up!Let's take a look at some of the most common credit card fees, and then talk about how you can avoid them. How To Survive In A Plastic World, Qualifying For Credit Card Let's face it, having credit is no longer a choice. "Don't leave home without it" is more like "can't buy a home without it. Credit Repair Myths and Facts There are no secrets to repairing your credit. Many shady credit repair agencies would love you to think the contrary. 10 Ways To Boost Your Credit Score 1. Deleting Errors in 48 HoursThis is the absolute fastest way to correct errors on your credit report and raise your credit score. Why Should You Use Credit Cards Believe it or not, the way society, especially the commercial side, is set up these days, the only alternative to using credit is to pay cash for everything. But it's actually quite hard to do that. Do You Want to Get a New Credit Card at a Great Rate? 1) Do your homework. Applying for and getting approved for a credit card is nothing more than legwork. Credit Cards and How To Choose Them: It may seem like a simple question but its important to take into account a few factors when choosing your credit card. If you are in the enviable position of being able to pay off your card every month then you are amongst the few. Pitfalls of the Credit Industry The credit industry if rife with pitfalls. If you have ever owned a credit card you probably already have learned this the hard way. 5 Ways To Prevent Credit Card Late Fees Paying a credit card late fee is the same as throwing your money away. Late credit card payments can also hurt your credit score. Check Your Credit Before Shopping For That Home Loan Review Your Credit Score.Nearly every bank, credit union, and mortgage lender relies on a three digit score provided by one of the three major credit bureaus to help them make lending decisions. Understanding Your Rights Under The Equal Credit Opportunity Act It wasn't all that long ago that lenders blatantly discriminated when it came to approving credit for women and minority groups. Women were actually asked personal and demeaning questions like, how many children do you plan to have in the future or are you on birth control?Despite the fact that they were entering the workforce in record numbers, single women were often required to get a cosigner or denied credit altogether. Making Sense of the Information in Your Credit Report If you've ever applied for a credit card or loan, you've probably had your credit report reviewed by the lender. Your credit report has a huge impact on your financial future, so it's well worth your time to be sure that you understand what your credit report says about you. How to Get Credit Reporting Agencies to Help You The process of clearing credit can be laborious and frustrating. Understanding your rights empowers you and saves you time and effort. How To Use Your Credit Card For Ultimate Financial Advantage Using a credit card wisely is an important step in building a great credit rating. If you're trying to re-build your credit or if you're young and just starting out, pay close attention the next time you receive a new card offer in the mail or online. Understanding the Process of Credit Counseling Many of us have seen the advertisements on television. "Get out of debt fast!" "We can solve all your credit problems with only one call!" These sound really great but you know that, realistically, one call is not going to solve your credit problems.
|
| Interesting articles | Home | site map | Link |
| © 2006 |
