How to slash Your Credit Card Bills
You may be paying too much interest if you are using your credit card in inappropriate ways. Your card has a high interest rate, so you need to pay your bills promptly. Carrying large balances for a long time can result in very high interest payments. This can upset your monthly budget and impact your credit score. You need to be cautious about using your card if you cannot repay the entire balance quickly.
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Try to clear your entire credit card balance every month
If you pay off the entire balance every month, you will avoid paying interest and improve your credit score. This will help you to qualify for loans with lower interest rates and fees. A higher credit score will make it much easier for you to qualify for mortgage loans and car loans. Lower interest rates can help you to save thousands of dollars over the term of a big loan of this type.
While it can be tempting to pay the minimum amount every month, this involves paying a lot of interest. It is best to clear your existing card dues before you take on more debt. Avoid using your card to make purchases impulsively. Save for expenditure on luxuries and extravagances.
Pay your credit card bills well before the due date
Keep track of the date on which your card bill is due and make the payment a few days in advance. If you wait until the last date, you may miss the deadline. If you mail a check to the issuer, allow a few days for delivery and clearing. Find out about how much time your bank takes to process online payments. An online payment may not be processed instantly, as you might think.
If you miss the due date by one or two days, the payment could be reported to the credit bureaus as late by 30 days. This will result in more interest and it could impact your credit score.
Have very high credit card balances?
If you have been carrying large balances for a long time, you may find it very hard to balance your household budget. Focus on improving your financial health if you are paying a lot of interest every month and are using your card to pay for everyday expenses, like groceries, fuel, and rent.
Avoid using your card to fulfill long-term financial requirements. The high interest charges will take a big chunk out of your monthly budget and you will be at risk of getting caught in a debt trap. If you are using your card in this manner, look for a financial advisor with a good reputation and work out a plan to repay your debts.
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