Choosing The Right Credit Cards Before Spending Can Make A Big Difference At Payoff Time
Boca Raton, FL (PRWEB) December 18, 2012
It’s that time of year again when most consumers will most likely spend more on their credit cards than at any other time of the year. Using the right cards is as important as not spending too much. Some of the department store and home improvement credit card accounts charge higher rates than regular Visa and Mastercard accounts issued by the major banks. What consumers need to watch out for are offers for a discount at the checkout counter in return for opening a charge account with the particular store they are shopping at. This is a common occurrence, you bring your goods to the checkout counter and they offer you 20% off your purchase for opening a charge account with the store. The 20% you are getting as a discount can be eaten up in a few months by the higher interest charged by the store card. If the consumer had refused the offer and used their regular Visa or Mastercard from a major bank in many cases the interest rate is much lower so the 20% discount can actually end up costing more in the long run.
Another issue to be aware of is the possibility of accounts eventually needing to be placed in a debt management program and again the major banks offer much better debt management rates than many of the store card accounts. These are facts that we have known at Accelerated Debt Consolidation, Inc. for many years and have done our best to pass on these facts to consumers. For a list of what is offered by some of the larger credit card issuers of both store credit cards and major bank cards CLICK HERE. Other offers that can be very tempting are offers for financing with no interest for an extended period of time. The store presents an offer to “Buy Now and Pay Much Later”. In some cases these retailers present offers with no payments and 0% interest for a year or more. What most consumers are not aware of is what the interest rate will be when that period of no interest and no payments runs out and in some cases if the balance has not been paid when the payments start coming due the payments can be very high with extremely high rates. A consumer would be much better off using a major bank issued account with an introductory rate that monthly payments are still required on each month.
At Accelerated Debt Consolidation, Inc. over the years we have seen that the bills that begin to come in after the holiday season can be quite devastating if proper planning and discipline is not used prior to setting out on your holiday shopping spree. Knowing which banks and other credit card issuers are the most consumer friendly not only for regular rates but debt management rates can greatly reduce the gravity of the impending post holiday payoff of debts. Here are some tips to help avoid these problems.
#1. Try to plan ahead for how much you are going to spend before going holiday shopping and stick to what you set as a limit for yourself.
#2. Look at your statements or call your creditors and know what your interest rates are for all of your accounts because they may vary significantly.
#3. Use credit cards with the lowest interest rates not just the ones that are issued by the particular store you are shopping in.
#4. Be very careful about accepting offers for discounts based on opening a charge account at the point of purchase.
#5. Avoid lengthy deferred payment offers
#6. Try to avoid using more that 30% of your credit limits on any particular account. Going over 30% of your credit limits drops your credit score until the balances are paid down. Consulting a debt management firm may be necessary of this has already occurred.
#7. Remember that in almost all cases using a major bank issued credit card will most likely have a lower rate if you are paying it on your own and if and when it may need to be placed in a debt management program.
#8. Try not to spend more than what can be paid in full when the bills arrive the following month.
If these steps are followed it can greatly reduce the severity of the holiday debt issue when the bills come due. For more information on credit card rates and debt management visit http://www.debtsynergy.com