How to reduce credit card finance charges
There are ways to save money on the costs of
finance charges on your credit cards.
Tips to lower costs
Make sure you card has a grace period, usually
20-25 days if you pay in full every month you
will pay no interest.
Change to a lower rate card. If you have a $1,000
average balance on your 18% credit card it will
cost you more than $180 in interest over one year.
If you switch to a 14% rate card you will save
Ask your card issuer to lower your rate. If you
have good credit and pay on time they will do
this every 6 months or so but you have to ask.
Pay your bill in full on time
Pay more than the minimum balance. The minimum
balance is deliberately designed by the card companies
to cost you the most money. Always pay more, even
$25 makes a big difference. Make sure that they
credit the extra to the principal not the next
Pay as soon as you receive the statement. The
sooner you pay the less finance charges accrue.
Pay twice a month! Easier on the budget and reduces
your daily balance sooner.