Being surrounded by different things which are draining our monthly budget, we are on a constant look out for ways to save money. The standard suggestions are that we should keep track of our spending, decrease utility bills, grocery bill etc. These suggestions are just fine and we should consider them, but we should also try and save money on some other items. One such an item is the credit card. Namely, do you know that you can save money on your credit cards as well? Maybe you are neglecting this possibility, but you should definitely get familiar with couple of ways to save money on your credit cards. Why spend money when a bit of knowledge could save you money.
Use balance transfer to consolidate credit card debt
Balance transfer can offer an opportunity for saving money on your credit card debt. But the saving opportunity should be carefully evaluated. When considering balance transfer make sure that you take into account balance transfer fee. The saving made on your debt during introductory period with low or 0% APR should be taken into consideration along with the cost of balance transfer fee. Keep in in mind that in order for the saving to be made you should be able to repay the debt before the end of the introductory period. Otherwise your credit card debt may end up costing you more than the cost of your debt on your old credit cards.
Rewards cards can save you money but they could also cost you money
There are credit cards offering different types of perks and rewards. If you are using the right type of credit card in accordance to your spending habits and life style, you could benefit from numerous rewards. But the trick is that banks are giving rewards on your credit card with some cost. Namely, banks are charging higher interest rate on these types of credit cards. So, in order for a saving to be made through rewards, you should be able to pay your outstanding balance in full each billing cycle. In case that your lifestyle or your budget is limiting you from paying the full balance, then maybe you should considered other ways to save money on your credit cards.
Don’t go with the minimum payment on your credit card
You are making the minimum payment on your credit card each month and that’s just fine. But is it really ok to pay the minimum? Do you know how much time it will take to repay in full the outstanding balance by paying the minimum? It can take couple of month’s even years if you have maxed out your credit cards. During this time you are paying interest rate, remember the longer the repayment period the higher the accumulated interest costs. Thus, in order to make a saving on your credit cards, try to pay more than the minimum each month. This way you will decrease your outstanding balance faster and save on your interest cost. In addition, you will be debt free in shorter period, at least credit card debt free.
Select the best credit card for you
Before you make the decision to apply for a credit card, go through the different types of credit cards. Consider the reasons as to why you need a credit card. You should also consider your life style and spending habits. This way you could ensure that you are applying for the right type of credit card.
Negotiate a lower interest rate on your credit card
For one reason or another when you first applied for your credit card you got a certain interest rate. But, do you know that you can contact your issuer about the possibilities for lowering the interest rate on your credit card. If you have improved credit score or if you have good payment history, you may be entitled to lower interest rate. Trying to negotiate lower interest rate could lead toward savings on your credit cards costs. As a starting point you may go through the offers of other issuers. Check the terms you would get if you apply today.
Regardless of their practicality and need, credit cards are rather costly. You could end up with an expensive financial product which is draining your monthly budget if you don’t manage your credit cards wisely. For this reason, make sure that you are acquainted with tricks to save money on your credit cards. There are couple of them listed here, but there other ways as well. Dedicate portion of your time on getting familiars with the possibilities to save money. Who knows, maybe these smaller savings will add up and be enough for a mini vacation.