6 Credit Card Secrets You Need to Know

Another important post that deals with the topic of credit card secrets. Secrets that can save you a lot of money if you heed our advice.

There are many secrets that credit card companies don’t want you to know. There are ways that you can avoid user fees and pay little to no interest on purchases. You are a customer, and each credit card company wants your business. Make them work for you. Here are a few great credit card secrets that will offer you a great deal of personal finance help.

1. Interest Backdating (Credit Card Secrets)

Unfortunately, many credit card companies charge you interest rates as high as 18% from the moment you make a purchase. Suddenly that cheeseburger you bought on the first day of the month for $4 has suddenly cost you $4.72 or 18% more. The more purchases you make with that credit card the more everything will end up costing.

Other credit card issuers only charge interest to those who have an outstanding balance with their account. This is a more favorable option for those who use their credit card a lot but if you are the type of person who carries a balance each month you may quickly find that you are sinking into debt.

There are three solutions for either situation that will provide a great amount of personal finance help.

Option 1: Find a different credit card issuer. They all want your business and will sometimes compete for it.

Option 2: ALWAYS pay the total amount of your credit card balance in full. Never miss or be late for a payment.

Option 3: Only use cash. Only use a credit card if that item is a major purchase like a washing machine. This will allow you time to budget and still help your credit rating.

Credit card secrets you need to know

2. Double Fees on Cash Advances – Credit Card Secrets

Some people don’t realize that cash advances are a costly way to spend money. Many card issuers impose both transaction fees and finance charges on cash advances. Transaction fees can be as high as 2.5% of the total amount taken. The other aspect that many people don’t take into consideration is that interest starts from the day of the advance. Suddenly the $200 you took out has suddenly ballooned to $240 in just one month. One other thing to consider is the ‘fine print’ that you need to read. Some cards offer ‘no finance charges’ but transaction fees may still apply. The solution to this problem is to limit the amount of cash advances you use or to not use them at all.

3. Eliminating Grace Periods – Secret Card Secrets

The offers some credit card companies lure you in with may sound a lot better than they actually are. The $12,000 limit and the endless rewards and benefits are often a misleading way of finding another way to get money out of you. The most common ‘string’ attached with these issuers is a card that has NO grace period. That basically means you are charged interest on every purchase from day one, even if you pay the bill on time. The personal finance help I am offering is to shred these ‘too good to be true’ offers the moment they arrive in your mailbox. Chances are the card you have right now is better than anything they can offer.

In the previous paragraphs, I discussed that there are many secrets that credit card companies don’t want you to know. There are plenty of options out there for you to pick from and many ways that you can avoid user fees and pay little to no interest on purchases. You as the customer have the choice to let your credit card work for you. Here are a few more exciting credit card secrets that will offer you a great deal of personal finance help.

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4. Two-cycle Billing: Credit Card Secrets

This is one other way that credit card companies will attempt to get more money from you and many people don’t even realize that two-cycle billing exists. In short, issuers will calculate an interest charge that is two months of interest if you were unable to pay off the balance in full. It seems like a nasty trick but you are borrowing their money after all. This problem only occurs if you switch from paying on time all of the time to carrying a monthly balance. The solution to rectify this problem is to switch to a new card issuer or ALWAYS pay your balance in full.

5. Fees Are Negotiable: Credit Card Secrets

Some cards charge service fees of $50 per month or more. The question you need to ask yourself is if paying a fee is actually worth the ‘privilege’ of using that particular card. Some companies also make you subject to pay finance charges of over 18%. The solution to this problem is easy to solve. If you are a good customer, your bank may be willing to drop the annual fee or reduce the interest rate or both. The only way you can make this work is if you go in and ask. If that doesn’t work switch to a new credit card company.

6. Shortened Due Dates: Credit Card Secrets

The most common grace period for credit cards is 25 days. You have this amount of time to pay for your purchases or you will be subject to high interest rates. Some banks have started to offer shorter grace periods of just 20 days – but only to those customers who pay in full every month. This is fine if you like the thought of the 20 day grace period. If you are less than thrilled about that idea the easy fix is to talk with your bank and they will probably switch you back to the usual 25 days. If they are unwilling to fulfill this request it may be time for a change.

For every issue there is a remedy when dealing with your credit cards. You as a customer have the right to negotiate annual fees and interest rates. Someone will want your business and will make sacrifices to make you, their customer. Hopefully, this list of options offered you the personal finance help you deserve.