Ideally, credit cards are used to help people build credit and to acquire large purchases without the need to have all of the immediate funds. In short, credit cards are supposed to exist as financial tools to help consumers; yet, consumers often abuse credit card privileges or are not cognizant of ancillary information that can later lead them into trouble. Credit cards can be used as a helpful tool, yet the irony is that they can quickly become your number-one financial problem. The following post hosts a number of small, simple ways to conduct relations with your credit card company in order to avoid debt management.
Balance Transfers
Many consumers seek to consolidate debts by transferring balances from other cards onto one. This can be an advantageous maneuver, but you must be careful. Some credit card companies charge more than four percent for balance transfers. In addition, some companies want to appear as if they are supporting credit debt relief and waive transfer fees… for the first transfer. Balance transfers can be used for debt management, but be sure to read all of the fine lines.
Beginning Rates
You probably get mailers all the time offering you super low rates on credit cards. Often, the credit card companies are advertising their beginning or ‘teaser’ rates. It is necessary to find out what the annual percentage rate will be after the ‘introductory’ period expires. Unfortunately, the credit card companies are running businesses after all, and though their literature is full of “we want to help you” sentiments, the sad reality is that you have to look out for what they are not telling you.
Late Payments
In addition to changing rates in regards to introductory periods, consumers must also be wary of shifts in payment rates in the event of a late payment. You may get so busy one month that your monthly payment date slips from memory and you find yourself owing beyond the deadline. Is it no big deal? Unfortunately, it may be a very big deal. Many people find themselves seeking consumer credit help because their payment rates skyrocketed as a result of one late payment.
As stated, credit cards can be a great convenience, yet the reality is that many people seek credit counseling agencies each day as a result of abusing credit cards or neglecting to understand all of the terms provided by credit card companies. By remaining cognizant of a few potential traps, you can maintain your own credit card debt solutions.