Video:Lower Credit Card Interestwith Jonathon E. Stewart
Credit card interest can put a financial strain on you if you don't know how to control it. Here's a video with tips for lowering credit card interest.See Transcript
Transcript:Lower Credit Card Interest
Paying interest on credit cards is something that none of us enjoy doing. But are you paying more than you need to be? Credit card interest varies widely from account to account, so it pays to be informed about where you stand. Banks can charge up to a whopping 30+ percent of your daily balance, or as little as zero. It's always best for your credit score and your savings account to pay off your credit cards in full each month. But if you do carry a balance, or balances, there are a few simple tricks to keeping your interest payments as low as possible.
Know Your Credit Card Interest Rate
Step One: Start by finding out exactly what percentage you are paying on each of your accounts. This information is generally listed on your statements, or in your account profile online. If there's any confusion in the matter, just call the number on the back of your card and ask a representative. Paying your bills on time, even if you're only making minimum payments, is essential to keeping your interest rates down as well.
Transfer Balances to a Card With a Lower Rate
Step Two: If you have multiple accounts, see about transferring your high interest balances to a card with the lowest interest rate. Call the bank you're intending to transfer to, and see if they'll offer an even lower rate than your current one for balance transfers. Banks want your debt, and are often highly incentivized to obtain or keep it. So don't be afraid to push for as low as a zero percent rate, especially on transfers. Over time, this kind of simple change can save you thousands of dollars.
Ask Bank to Lower Your Credit Card Interest Rate
Step Three: If you are not able or don't want to transfer your balances, there is one simple way to get your existing banks to lower their interest rates: just ask. Surveys have shown that over 50% of credit card customers will get a one-third or better reduction, all for just asking on the first call. And don't be afraid to call multiple times if you don't get the answer you're looking for right away. Try speaking to supervisors, threatening to transfer your balance to other banks, or citing competitor's advertised interest rates. Remember, the squeaky wheel gets the grease, and especially when it comes to credit card interest, it's grease worth getting.