Credit cards: Reduce Your Interest Costs
Each month, when you receive your credit card balance, you are blown away by the amount you have to pay in interest? Here are some tips to help you reduce these costs.
Pay your credit card balance in full each month, when the statement expires. This is, of course, the most advantageous solution!
Make a payment as soon as possible, before the next statement is released, when you are unable to pay your monthly balance on time. In this way, you will save in interest costs, as they accumulate from the date of your purchase, until the full payment of the balance.
Get a low-interest credit card, especially if you're one of those who don't pay off their balance in full each month.
Stop using your credit card, which is the most aggressive solution when you never manage to pay your card balance in full on each due date.
By the way
Ask your financial institution to take your credit card balance to a line of credit at a lower interest rate or a personal loan.
Find a way to cut into your budget so you can spend larger amounts to pay off your debts.
Try to increase your income. You may need to find a second job to pay off your debts. The satisfaction you will feel when you see a daily decrease in a sum owed will be well worth it.
Choose the order to repay your debts. There are two ways to do this:
starting with those with the highest interest rates.
first of all, paying the lowest amount.
In both cases, you will need to draw up a complete list of your debts, and then save with all your might to get rid of them as soon as possible. It is up to you to determine the order in which you want to repay.
Logically, the first method is the most profitable for you, because it allows you to free yourself first from the debts that cost you the most (those with the highest interest rates).
That said, maybe you're one of those who prefer quick little wins? If this is the case, the second method may be more suitable for you. Here's why: By putting all your energy into saving to pay off your first small debt, and seeing it melt quickly, you'll become so motivated that you'll want to tackle with even more bite to the next.
The heart sometimes has its reasons that reason does not know... The most important thing is that the method you choose works.
When you're done repaying a loan, keep saving and devoting the amount of money from your old payments to your next debt.
In short, by showing discipline and determination, you will be able to keep control of your debts.
Attention! It may seem enticing at the time, but...
When you apply for a cash advance on a credit card, the interest applies from the moment you have the money on hand, until it is fully refunded.
If you do not make your credit card payment before the due date on your statement of account, you will have to pay interest based on the total amount of your balance until you have paid it in full.