Tip #2 – Partial Payment Interest
Did you know….if you pay less than the full amount owing on your statement by the due date, you will pay interest on the full amount? For example, your balance owing is $1510 and your payment is due today. If you only pay $1500, most cards will charge interest on the entire balance of $1510. Interest adds up fast enough so avoid this trap if you can. If you make an honest mistake – likely paying $1501 rather than $1510 – and normally pay your balance in full, call your credit card company and ask if they’ll reverse the charge for you.
Tip #3 – Interest Rate Change
Did you know….some credit cards may increase the interest rate on your card if you are even one month in arrears? Check your statements carefully each month to see what interest rate you’re being charged. If they do increase your interest rate because you missed a payment it will normally take a full 12 months of on-time payments to get it brought back down.
Tip #4 – Payment Due Date
Did you know… if you make your payment on the due date, the credit card company may charge you interest as if you paid late? In some cases, processing can take up to 5 days. Make a habit of paying your credit cards 5-7 days prior to the actual payment due date to be sure. If any errors occur, contact your credit card company and ask them to reverse any charges.
You may also not be aware, it’s just fine to make more than one payment each month. As part of your pay cheque planning, make payments when you’ve got the money to avoid inadvertently spending it on something else. Along with checking over the purchases you make each month, ensure that all of the payments you make are accurately reflected as well.
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