How to avoid credit card charges

How to avoid credit card charges and high Intrest

How to avoid credit card charges, and high Intrest

How to avoid credit card charges, and high Interest. It’s one of the easiest ways to fall into a debt trap. This trap is difficult to escape and can be costly. After rolling-over, you will be charged interest rates between 36 and 48 percent for any credit card balance.

How to avoid credit card charges and high Intrest

How to avoid credit card charges and high Intrest

How to avoid credit card charges, and high Intrest These are six ways to use your credit card responsibly and reduce the interest rate.

1. On the due date, pay the credit card balance

Any credit card issued by Visa or Mastercard requires that you pay 5% of the outstanding credit card amount each month. You can roll the balance over to the following month. This is a quick way to get into debt. You will be charged a late fee and interest charges if you fail to pay the minimum of 5 percent on time.

You should make full payment by the due date to avoid interest costs. To keep credit card interest costs low, make full payment by the due date. And you can use the Cred Application to Manage your credit cards accounts.

2. New purchases are subject to interest charges.

Monthly interest will be charged if the balance is not paid by the due date. You could end up in a debt trap if you continue to roll over the balance and make new purchases every month.

How to avoid credit card charges and high Intrest, Credit card purchases typically come with a 30-day interest-free period. This can extend to up to 45 days. The outstanding amount must be zero to qualify for this benefit. If you transfer a certain amount to the next month’s bill, there is no interest-free period for new purchases.

You should not make any new purchases on your card unless you have cleared the outstanding amount. This will keep the interest costs lower.

3. Balance transfer

You might not be able pay the full amount if you have limited funds. A large interest charge of 3-4 percent per month is charged on revolving credit.

How to avoid credit card charges, and high Intrest, What to do If you have more than one card, it is possible to request a balance transfer (BT) facility. Once the facility has been used, the card limit is limited to the amount that can be BT. The facility allows one to transfer the balance to another credit card at a lower interest rate of between 1 percent and 1.77 percent per month. Balance transfer refers to the process of moving your debt from one credit line to another. Manav Jeet is the CEO & MD of Rubique Technologies. The objective is to reduce interest payments every month by using a low-interest credit card.

 

However, there will be processing fees, which are generally 1 percent of the BT total. Sometimes, card issuers offer zero interest BT facilities. “Zero-interest offers are usually temporary and last for between 3 and 12 months. Jeet advises that the balance must be repaid within the agreed time. Jeet warns against transferring balances between credit cards if you plan to do so. “Consider that credit score can be affected by frequent balance transfers or higher balances on credit cards.”

4. Convert to EMI

Your card could allow you to make high-ticket purchases. You can convert the card into EMIs if you are unable to pay it off completely. They have a lower interest rate that what you would have paid. The interest rate after conversion could be between 14-24 percent lower than that on the card.

You should know: There are two types of EMI conversion services. The merchant EMIs are the ones that a merchant offers to you when you purchase a product with your credit card. Your credit card issuer might offer an EMI option for certain high-ticket purchases that you make with your credit card. These are also known as EMIs On Call,” says Navin Chandani (CBDO, BankBazaar).

Reward points are not earned on EMI payments. Also, be aware of the processing fee. Chandani explains that although merchant EMIs are free of associated fees, card issuers often charge for transferring a credit-card balance to an EMI by phone.

5. You can withdraw cash from your bank account as soon as possible

How to avoid credit card charges, and high Intrest, You must withdraw cash using your credit card from ATMs. This will not allow you to earn interest. You may be charged a one-time fee and interest from the first day of withdrawal until you pay it back.

You can avoid higher interest rates by paying the amount back early.

6. Avoid using credit cards abroad

It is possible to use a credit card abroad to make foreign currency transactions. However, it can be costly. Conversion charges will apply to credit cards used abroad. Additional fees may be charged if the card is used at an ATM. Conversion charges can range from 3 to 5 percent.

You can also carry a forex card abroad to get better pricing and keep the overall cost down. And also read on Couponss 

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