Most of us are familiar with the regular credit card advice like “choose the card with the lowest interest rate” and “stay away from cards with annual fees. But there are other credit card secrets that many are not aware of. These are 4 amongst them.
1. Eliminate annual fees. You can keep all your cards with annual fees but not pay the fees. You can do this by calling your credit card companies and informing them that you would like to cancel your account. Your call will be quickly transferred to an account manager or “customer specialist” who would insist on knowing the reason behind your action. Inform them that you would like to keep those credit cards without any annual fees. Most of the companies would then eliminate your card fees since they want your business. But this is possible only if you have been paying your card payments promptly.
2. Keep a watch on the fluctuating due dates on your statements. Some credit card companies are not satisfied by charging you fees and interest but now are intentionally altering the due dates on your credit card statements, so that you pay late unintentionally. These credit card companies not only collect a heavy late fee from you but also increase your interest rate, not only on this card but even on other cards. So as soon as you get the statement, check the due date carefully.
3. Understand the universal default rules. Read the terms and conditions. As per universal default; rules, if you make late payment on one card, or if you exceed the limit, the interest rate on other cards will increase too. Default interest rates can be 10% over the normal rate. So you can end up paying additional $400 each year on the credit card debt of $4,000.
4. Lower the credit card debt quickly by not paying over the minimums on most cards. This should be done for all the cards except the one carrying the highest interest rate. Use the money saved by paying the minimum on other cards towards paying the balance on the card with the highest interest rate. After you pay off the balance on this card, repeat the process for the card whose interest rate is next highest. You will find the size of your debt will quickly shrink and hence this is the most crucial credit card secret.
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