Over the course of our lives, we all tend to rely on credit to get by. There is little we can do to escape the effect of a debtors society regardless if it is for a mortgage on our home, a loan for a car, or a payday loan to get by until next Friday. But how you handle your debt is definitely what you have a say in and you could even spend or save thousands of dollars a year depending on the way you do so.
Let's imagine you have a few credit cards on the go. One of them, the card you had since you were in college, has a few grand racked up on it, and because you missed a few payments way back when, the interest rate is at 19%.
But because we don't really give it a second thought, there are a lot of us that don't look at the interest rate we are paying. If MasterCard says what we owe them is $184, then we pay $184.
The truth is, it doesn't have to be that way. A card will be given to you by many credit card companies albeit with high interest after a period of time and a 0% interest on all credit card transfers is what you will get for the first 6 months to a year. What this means is, if you use your new card to pay a big chunk of your old card, you pay no interest on the new card for a set period of time.
Of course, once that the time is up, then they will put you back on the expensive interest rate but the money that you pay on your credit card is all-principal for a short time.
Credit card companies don't like you doing this too much - in fact, they'll put it on your credit card report if you do it more than a couple of times - but if you're looking to get out of a short term financial logjam, look for those introductory offers and use a new card to pay off your old card.
Oh, and when you do - shut the old card down!
Let's imagine you have a few credit cards on the go. One of them, the card you had since you were in college, has a few grand racked up on it, and because you missed a few payments way back when, the interest rate is at 19%.
But because we don't really give it a second thought, there are a lot of us that don't look at the interest rate we are paying. If MasterCard says what we owe them is $184, then we pay $184.
The truth is, it doesn't have to be that way. A card will be given to you by many credit card companies albeit with high interest after a period of time and a 0% interest on all credit card transfers is what you will get for the first 6 months to a year. What this means is, if you use your new card to pay a big chunk of your old card, you pay no interest on the new card for a set period of time.
Of course, once that the time is up, then they will put you back on the expensive interest rate but the money that you pay on your credit card is all-principal for a short time.
Credit card companies don't like you doing this too much - in fact, they'll put it on your credit card report if you do it more than a couple of times - but if you're looking to get out of a short term financial logjam, look for those introductory offers and use a new card to pay off your old card.
Oh, and when you do - shut the old card down!
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