APR http://www.wisebread.com/taxonomy/term/1060/all en-US Should You Buy a Car With a Credit Card? http://www.wisebread.com/should-you-buy-a-car-with-a-credit-card <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/should-you-buy-a-car-with-a-credit-card" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/businesswoman_hold_credit_card_a_toy_car_and_a_stack.jpg" alt="Businesswoman hold credit card, a toy car and a stack" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>While most people rely on cash or bank financing to buy a car, it may be possible to make all or part of your vehicle purchase with a credit card instead. This might seem like a risky proposition, but there are real, tangible benefits that can come from using this payment method if you're careful.</p> <p>With the right credit card strategy, you could earn rewards for your car purchase, save money on interest, and potentially pay your car off faster. Obviously, there are also a lot of things that can go wrong with this strategy. If you can't afford a car and are looking at a credit card as your way to finance it because you have no other options, forget it. You'll end up worse off if you can't make payments on your credit card.</p> <p>Even if you can afford the car, you'll need to answer a few questions. Let's talk about whether charging it makes sense &mdash; and when it's possible.</p> <h2>Is it possible to buy a car with a credit card?</h2> <p>First, you need to determine whether the dealership or car lot you're buying from will allow it. There are instances when a car lot may let you&nbsp;pay for your entire car purchase with credit, but those situations are rare.</p> <p>More likely, if a dealership lets you pay with a credit card at all, it will cap the amount at, say, $5,000. The main reason dealerships hesitate to let you charge tens of thousands of dollars to your card is that, like other merchants, they pay interchange fees to accept credit cards. These fees are usually around 2 percent, sometimes higher. So, if you charge a $30,000 car, your dealership could be on the hook for at least $600 in processing costs.</p> <p>The other thing you need to note is your available balance. Obviously, you can't charge more than your credit limit, so you'll need to be aware of that limit.</p> <h2>Earning rewards with a car purchase</h2> <p>While there is more than one way charging your car to a credit card can leave you ahead, the most intriguing opportunity is the rewards you could earn. You can get <a href="http://www.wisebread.com/5-best-cash-back-credit-cards?ref=internal" target="_blank">cash back</a> or <a href="http://www.wisebread.com/top-5-travel-reward-credit-cards?ref=internal" target="_blank">travel rewards</a>. You might even want to use a <a href="http://www.wisebread.com/capital-one-buypower-get-your-dream-gm-car?ref=internal" target="_blank">co-branded car credit card</a> (yes, they exist!). This can provide you a hefty discount when you are ready for your next car.</p> <p>Obviously, this strategy is only worth pursuing if you have the cash in the bank to pay your card off right away. While the cards with the most lucrative rewards programs help you earn &quot;free money&quot; on large purchases, the interest rates they offer tend to be higher than average. If you put $30,000 on a credit card that charges 15 percent and it took you five years to pay your loan off, you would fork over $12,822 in interest alone.</p> <h2>Saving interest on a car purchase with a 0% APR card</h2> <p>This leads to the second reason some people may choose to charge their car purchase &mdash; to save money on interest. While many rewards cards charge higher interest rates than most, an array of cards charge <a href="http://www.wisebread.com/5-best-credit-cards-with-0-apr-for-purchases?ref=internal" target="_blank">0% APR for new purchases</a> for 12&ndash;21 months.</p> <p>The key to making a 0% APR card work in this scenario is making sure you can pay the balance in full before your introductory offer ends. Once it's over your rate will reset to a regular credit card interest rate, which is almost certainly higher than the rate you'd get on a car loan.</p> <p>Before you pick a 0% APR card for your car purchase, make sure you can pay the balance in full before the introductory offer ends. That way, you can truly save money on interest &mdash; and not end up potentially paying more in interest than if you'd just gone with a loan.</p> <h2>Buying a car with a credit card</h2> <p>If you're dead set on charging your car to a credit card, it's important to think through several important scenarios first. Here are four tips that can help you get the most out of the situation.</p> <h3>1. Don't talk about payment until you've negotiated a price</h3> <p>While there's nothing wrong with using credit for a car, your car salesman may want to make up for their fees by charging you a higher sales price. That's why you should never reveal that you intend to pay with credit until you've negotiated the terms of the sale. By slow-rolling your credit card payment plan, you can get the best price possible while also gaining the benefits of using a card.</p> <h3>2. Make sure you're getting the best deal possible</h3> <p>As with any car purchase, you should research the cars you're interested in online before you ever step into a dealership. Websites like&nbsp;Kelley Blue Book&nbsp;can help you figure out exactly what a car is worth based on its make, model, and condition. If the dealership wants you to pay more than a car is truly worth, the rewards you're earning probably won't be worth it, especially if they decide to tack on a fee for using a credit card.</p> <h3>3. Do the math before you buy</h3> <p>While getting 0% APR on your car purchase can pay off, it's important to do the math if you don't think you'll pay off the entire purchase before the introductory offer ends. If you need several years to pay your car loan in full, for example, you will be better off with bank or dealership financing &mdash; even if the ongoing APR seems high.</p> <h3>4. Decide what you want &mdash; 0% APR&nbsp;or&nbsp;rewards</h3> <p>While a slew of popular credit cards offer rewards or 0% APR for a limited time, few cards offer the best of both. Before you charge your car to a credit card, make sure you have defined goals and a plan to reach them. And if you don't have the right credit card to meet your needs for this purchase, explore your card options and apply for a new card before you step into a dealership.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fshould-you-buy-a-car-with-a-credit-card&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FShould%2520You%2520Buy%2520a%2520Car%2520With%2520a%2520Credit%2520Card-.jpg&amp;description=Should%20You%20Buy%20a%20Car%20With%20a%20Credit%20Card%3F"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Should%20You%20Buy%20a%20Car%20With%20a%20Credit%20Card-.jpg" alt="Should You Buy a Car With a Credit Card?" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/holly-johnson">Holly Johnson</a> of <a href="http://www.wisebread.com/should-you-buy-a-car-with-a-credit-card">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-times-you-can-score-a-great-deal-on-a-new-car">5 Times You Can Score a Great Deal on a New Car</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-secrets-to-a-higher-car-trade-in-value">8 Secrets to a Higher Car Trade-In Value</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-new-car-costs-the-dealer-is-hiding-from-you">10 New Car Costs the Dealer Is Hiding From You</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-magic-words-to-say-to-get-the-best-new-car-price">10 Magic Words to Say to Get the Best New Car Price</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-buy-a-used-car-without-getting-ripped-off">How to Buy a Used Car Without Getting Ripped Off</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Cars and Transportation APR dealerships fees financing interest rates negotiating new car rewards vehicles Wed, 05 Jul 2017 08:30:12 +0000 Holly Johnson 1974820 at http://www.wisebread.com 4 New Reasons You Need an Emergency Fund http://www.wisebread.com/4-new-reasons-you-need-an-emergency-fund <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-new-reasons-you-need-an-emergency-fund" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/emergency_fund_money_jar_filled_with_american_currency.jpg" alt="Emergency fund money jar filled with American currency" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>You need an emergency fund: You've probably been told this plenty of times before, and you maybe haven't taken it as seriously as you should have.</p> <p>Well, some fresh data from 2017 proves that &hellip; yes, you really do need an emergency fund! If you've delayed stashing that money away, now is the time to start.</p> <h2>1. Potentially higher health care costs under AHCA</h2> <p>Let's start with a big-ticket item: health care. Under the current administration, the American Health Care Act (AHCA) is adjusting several items from its predecessor, the Affordable Care Act (ACA), otherwise known as Obamacare.</p> <p>Depending on several factors, including your age, and income level, and where you live, you may end up paying more or less under the AHCA than you did under the ACA. Those who are older, have a lower income, and live in an area with higher premiums are likely to pay more under the AHCA. For example, while a 40-year-old resident of Cherry County, Nebraska making $50,000 per year would pay 21 percent more in health premiums under the AHCA, a 27-year-old resident of Tulare County, California would pay 26 percent <em>less</em>.</p> <p>To get an idea of how much you would in pay under the AHCA, use this <a href="http://kff.org/interactive/tax-credits-under-the-affordable-care-act-vs-replacement-proposal-interactive-map/" target="_blank">predictor tool</a> from the Kaiser Family Foundation and get more information from your current health plan provider. Having an emergency fund would allow you to be ready to cover not only medical emergencies, but also the potential hike in those health care premiums.</p> <h2>2. Worrying about finances makes you less productive at work</h2> <p>According to recent data from the Employment Benefit Research Institute, three in 10 American workers claim they worry about personal finance at their workplace. Even worse, over 50 percent of those workers believe that time spent fretting about money is making them less productive for their employers.</p> <p>If you belong to this group of workers, then you would regain peace of mind at work with an emergency fund. By knowing that you could cover your necessities for three to six months if you were to lose your job, you would be able to focus on performing better and increasing your chance of a raise.</p> <h2>3. Average credit card APR is on the rise</h2> <p>What do you do when you don't have money to cover surprise expenses, such as the water heater breaking or the car going on the fritz? Most people without an emergency fund turn to a credit card.</p> <p>Well, here is some bad news: A CreditCards.com survey found that the average credit card APR had reached a record 15.89 percent as of June 14, 2017. If your credit score is less than perfect, you can expect to pay an interest rate even higher than that average.</p> <p>Remember, the whole point of having an emergency fund is to lower your financial risk. By using a credit card as an emergency fund, you're only adding risk to your personal finances.</p> <h2>4. Opportunity only comes around so often</h2> <p>Many people think of an emergency fund as a &quot;rainy day fund.&quot; However, others think of it as an &quot;opportunity fund&quot; &mdash; a way to never miss out on a great opportunity for want of cash. And while an emergency fund should never be thought of as play money, if you have enough saved, you can use some of that cash to fund a special opportunity that may not come again. (See also: <a href="http://www.wisebread.com/why-opportunity-funds-are-the-new-emergency-funds?ref=seealso" target="_blank">Why &quot;Opportunity&quot; Funds Are the New Emergency Funds</a>)</p> <p>Here are some examples:</p> <ul> <li> <p>You have the chance to refinance your mortgage to a lower rate (and lower your monthly payment!), but you don't have any savings to cover the necessary $2,000 to $3,000 closing costs. Luckily, there's enough in your emergency fund to help you go through with the refi.</p> </li> <li> <p>You've had a lifelong dream of taking a two-week trip around Europe, but the tour company that you like is a little out of your price range. They offer a limited-time discount, and you pull some money from your emergency fund to take that trip of a lifetime.</p> </li> <li> <p>The refrigerator that you've had since college has been jacking up your electricity bill for years. You discover that you could slash your monthly bill by 40 percent <em>and </em>get an energy rebate from the state government if you were to buy a more energy-efficient model. You don't have the money upfront, and the rebate expires next month &hellip; but there's enough in your emergency fund.</p> </li> </ul> <p>The list goes on. An emergency fund is usually a building block to achieve financial security, but it could also allow you to gain financial freedom. Once you gain the discipline to save enough to cover your necessities in case of an emergency, you may be able to continue to save in case of a seizable opportunity &mdash; or even a lifelong dream.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F4-new-reasons-you-need-an-emergency-fund&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F4%2520New%2520Reasons%2520You%2520Need%2520an%2520Emergency%2520Fund.jpg&amp;description=4%20New%20Reasons%20You%20Need%20an%20Emergency%20Fund"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/4%20New%20Reasons%20You%20Need%20an%20Emergency%20Fund.jpg" alt="4 New Reasons You Need an Emergency Fund" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/4-new-reasons-you-need-an-emergency-fund">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-find-the-savings-strategy-that-works-for-you">How to Find the Savings Strategy That Works For You</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-to-expect-after-these-5-personal-financial-disasters">What to Expect After These 5 Personal Financial Disasters</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0">6 Ways You Can Cut Costs Right Before You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-start-a-family-before-reaching-these-5-money-goals">Don&#039;t Start a Family Before Reaching These 5 Money Goals</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-places-to-check-out-medical-care-for-the-uninsured">5 Places to Check out Medical Care for the Uninsured</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance APR emergency fund expenses health care interest rates job loss opportunity fund rainy day fund saving money stress surprises Thu, 29 Jun 2017 08:00:10 +0000 Damian Davila 1973594 at http://www.wisebread.com We Do the Math: Save for Retirement or Pay Off Credit Card Debt? http://www.wisebread.com/we-do-the-math-save-for-retirement-or-pay-off-credit-card-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/we-do-the-math-save-for-retirement-or-pay-off-credit-card-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-514332608.jpg" alt="Couple wondering if they should save for retirement or pay off debt" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Should you save for retirement or pay off credit card debt? If you're carrying a card balance, you may be wrestling with whether to put all your resources into attacking the debt, or start building your retirement nest egg while you slowly pay off debt.</p> <p>Which one will give you a better net worth? There's no simple answer. For some people the situation may warrant clearing credit card debt first; for others, it's better to start investing right away. To figure out which scenario is better in a given situation, we'll need to do some math. Don't worry, we'll show you how to do it in a few easy steps.</p> <h2>Step 1: Gather important numbers about your debt and your retirement plan</h2> <p>First, look through your credit card statements and accompanying information to pull up the following numbers:</p> <ul> <li>Credit card debt. You'll find this on the front of your credit card statement.<br /> &nbsp;</li> <li>Credit card interest rate, or APR (Annual Percentage Rate). You'll find this further down on your statement, in a section labeled &quot;Interest Charged&quot; or something similar.<br /> &nbsp;</li> <li>Minimum payment. You'll find this in your card's terms and conditions, under a discussion about how minimum payments are calculated. It will probably be a percentage, but there may also be a flat sum.</li> </ul> <p>Next, consider any retirement plan you are enrolled in or have available. What is the average annual return? You can identify past returns by reviewing your retirement account statements. For example, your 401(k) plan account may list your annual return. Note that past returns don't guarantee or predict future returns, but we'll use the average annual return as a proxy for future returns in this case, knowing that if our portfolio takes a long-term downward turn, our calculations will change.</p> <p>Finally, how much extra do you have in your monthly budget that you could put toward credit card payments, retirement investments, or both?</p> <p>Follow along as we consider a hypothetical debt situation and retirement opportunity. Let's say there's $500 in our monthly budget, which equals $6,000 annually ($500 x 12 months = $6,000) to put toward debt or retirement.</p> <p>Currently, the balance on our credit card is $5,000. Our APR is 22%. Our minimum monthly payment is 3% of our outstanding balance or $25, whichever is greater.</p> <p>Our employer offers a 401(k) plan. For the sake of keeping this illustration simple, we'll say our employer doesn't match employee contributions and we choose to make taxable contributions with a Roth designated account within the 401(k).</p> <p>In reality, you might choose instead to make tax-deductible contributions to a&nbsp;<a href="http://www.wisebread.com/how-to-set-up-an-ira-to-build-wealth?ref=internal" target="_blank">traditional retirement account</a>. With a Roth 401(k) there are no immediate tax benefits, which makes our calculations simpler and therefore better suited for this purpose.</p> <p>We'll say the default investment in our 401(k) is a&nbsp;<a href="http://www.wisebread.com/the-4-best-investments-for-lazy-investors?ref=internal" target="_blank">target-date mutual fund</a> with an average annual return of 6.3% since its inception. We know that future performance is unpredictable. But to run the numbers for the retirement vs. debt decision, we'll apply an annual return of 6% to our retirement account.</p> <p>We'll look at the retirement account and credit card balance after five years to compare the two choices: 1) making minimum payments on our card balance so we can start investing right away, or 2) putting all our extra money toward our credit card debt before we consider retirement investing.</p> <p>In both scenarios, we'll assume that we won't make additional charges on our credit card. In addition, we'll contribute to our retirement account when we have money available to invest.</p> <h2>Step 2: Calculate net worth if you prioritize retirement savings over paying off credit card debt quickly</h2> <p>In this scenario, we'll see what happens if we only make minimum payments on our credit card so that we can get started investing for retirement right away. Your credit card statement should state very clearly how long it will take to pay off your balance if you make minimum payments.</p> <p>You can also find an&nbsp;<a href="http://www.calcxml.com/calculators/how-long-will-it-take-to-pay-off-my-credit-card" target="_blank">online calculator</a> to help you with these calculations. Here's the information we'll enter for our example (you can put in your own numbers from your real-life situation):</p> <ul> <li>Current credit card balance: $5,000<br /> &nbsp;</li> <li>Annual percentage rate: 22%<br /> &nbsp;</li> <li>Proposed additional monthly payment: $0<br /> &nbsp;</li> <li>Minimum payment percentage: 3%<br /> &nbsp;</li> <li>Minimum payment amount: $25<br /> &nbsp;</li> <li>Skip December payment when offered? No</li> </ul> <p>Results indicate that we'll carry this debt for more than 17 years (205 months) and pay more than $7,000 in interest during this time. Click the button that says &quot;Detailed Results&quot; to see a breakdown of the payments. Make sure that under the Assumptions tab, you've asked for a monthly table display.</p> <p>In the first month, our payment is $150 and this amount slowly diminishes until we're paying the minimum amount of $25 for the last several years.</p> <p>Since we're making minimum payments on the credit card, we'll be able to put $350 of our total available $500 toward retirement in the first month ($500 - $150 = $350). The second month and subsequent months, we'll be able to increase the amount we invest, as our credit card balance dwindles. Every month we also earn some interest (6%/12 months), so our retirement account balance grows in that way, too.</p> <p>After five years (60 months), our credit card balance will be trimmed to less than $2,500.</p> <p>At the end of five years, our retirement account grows to just over $27,300. Considering our debt and retirement balances, our net worth is $24,800 ($27,300 in assets and $2,500 in liabilities). Note that investment returns are not guaranteed; the 6% rate is for illustration purposes only.</p> <p>You can&nbsp;<a href="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/Rains_We Do The Math Spreadsheet - Sheet1.pdf" target="_blank">download the spreadsheet</a> with these calculations.</p> <h2>Step 3: Calculate net worth if you pay off credit card debt completely before investing for retirement</h2> <p>In this scenario, we'll apply all of our extra income to credit card debt first. When the debt is paid in full, we'll begin to contribute to the retirement account.</p> <p>We enter this information to learn how quickly we'll pay off the debt with $500 per month (again, enter your own information to get personalized results):</p> <ul> <li>Current credit card balance: $5,000<br /> &nbsp;</li> <li>Annual percentage rate: 22%<br /> &nbsp;</li> <li>Minimum payment percentage: 0%<br /> &nbsp;</li> <li>Minimum payment amount: $0<br /> &nbsp;</li> <li>Proposed additional monthly payment: $500<br /> &nbsp;</li> <li>Skip December payment when offered? No</li> </ul> <p>To keep the credit card payment at $500 per month (and pay off credit card debt first), we'll enter the minimum payment percentage as 0% and the minimum payment amount as $0 &mdash; even though the actual terms of the credit card agreement will most likely specify a percentage of 2% or more and a minimum payment of $10 or more. When we view the results, we find that the payoff happens in 12 months. We'll make 11 payments of $500 and one payment of $74.</p> <p>After we finish paying off the credit card debt, we can begin investing. We'll invest $426 in the twelfth month ($500&ndash;$74) and $500 in subsequent months. Consider using a&nbsp;<a href="http://www.calculator.net/future-value-calculator.html" target="_blank">Future Value calculator</a>, to determine how much your retirement account will be worth at the end of five years.</p> <p>Here's the information we entered into the Future Value calculator:</p> <ul> <li>Number of periods: 48. (We'll invest for four years, or 48 months.)<br /> &nbsp;</li> <li>Start amount: $426. (We'll start with the first month's contribution as the balance in our account.)<br /> &nbsp;</li> <li>Interest rate: 0.5% (6% annual rate divided by 12 months).<br /> &nbsp;</li> <li>Periodic deposit: $500.<br /> &nbsp;</li> <li>Deposit made at the beginning or end of the period: End.</li> </ul> <p>If we earn 6% annually on our investments, our retirement account grows to $27,590 in five years. In addition, our credit card debt is paid off. Our net worth is $27,590 &mdash; that's $2,790 <em>more </em>than if we had prioritized retirement savings first and stuck with only paying the minimum on our credit card debt each month.</p> <h2>What else to consider</h2> <p>These calculations are a starting place. Your situation may be similar to this scenario, but it might not be. For instance, if your APR is considerably lower and your retirement returns higher than in the scenarios above, you may very well find that you're better off investing in the market while reducing your credit card debt slowly. Changes in one or several of these factors could alter results:</p> <ul> <li>Larger or smaller credit card balances;<br /> &nbsp;</li> <li>Higher or lower credit card APRs;<br /> &nbsp;</li> <li>Better or worse investment performance;<br /> &nbsp;</li> <li>Availability of a company match on your 401(k);<br /> &nbsp;</li> <li>Administrative fees associated with your 401(k);<br /> &nbsp;</li> <li>Choosing to invest in a traditional 401(k).</li> </ul> <p>If you opt for a traditional 401(k), your contributions come out of your pretax income, thereby reducing your taxable income, which could result in a lower tax liability and a higher tax refund. A tax refund could be applied to your credit card balance, allowing you to more easily pay off debt while also saving for retirement.</p> <p>To calculate the immediate tax benefit of saving within a traditional 401(k) account, multiply the contribution amount by your marginal tax rate. In addition, you could be eligible for a&nbsp;<a href="https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-savers-credit" target="_blank">saver's credit</a>, which further increases the benefit of retirement savings.</p> <h2>How to get started with either scenario</h2> <p>Whatever path you choose, you may need help taking first steps. Consider these ways to get started:</p> <h3>Debt payoff</h3> <ul> <li>Consider transferring or consolidating your balances on a&nbsp;<a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=internal" target="_blank">0% balance transfer card</a>.<br /> &nbsp;</li> <li>Consider a&nbsp;<a href="http://www.wisebread.com/how-to-do-a-one-month-spending-freeze?ref=internal" target="_blank">no-spend week or month</a> in which you don't spend on anything except essentials.<br /> &nbsp;</li> <li>Apply cash gifts from family to credit card balances.<br /> &nbsp;</li> <li>Work a part-time job to pay down balances.<br /> &nbsp;</li> <li>Find ways to spend less on everyday expenditures and apply savings to debt payoff.</li> </ul> <h3>Retirement saving</h3> <ul> <li>Consider enrolling in your employer's retirement plan, if offered. You may have the opportunity to contribute to a&nbsp;<a href="http://www.wisebread.com/403b-vs-401k-how-are-they-different?ref=internal" target="_blank">401(k) or 403(b) account</a>, for example.<br /> &nbsp;</li> <li>Set up an&nbsp;<a href="http://www.wisebread.com/choosing-a-retirement-account-whats-available-and-what-s-best-for-you?ref=internal" target="_blank">IRA</a> with a brokerage account or&nbsp;<a href="http://www.wisebread.com/should-you-trust-your-money-with-these-4-popular-financial-robo-advisers?ref=internal" target="_blank">robo-adviser</a>.<br /> &nbsp;</li> <li>Start an&nbsp;<a href="http://www.wisebread.com/the-sep-ira-is-how-the-self-employed-do-retirement-like-a-boss?ref=internal" target="_blank">SEP-IRA</a> if you have self-employment income.</li> </ul> <p>When considering your choices, keep in mind that credit card interest rates are relatively fixed, whereas investment returns tend to be much more variable. The main instances in which credit card rates fluctuate these days are when the Federal Reserve raises the federal funds rate, or when you make late payments and are charged a penalty interest rate.</p> <p>The point is, if your card's APR is 22%, you could be certain to save at least 22% of your balance by paying off credit card interest early. In contrast, the precise benefit of early investing is less certain.</p> <p>Should you save for retirement or pay off credit card debt? Doing the math can help you make a decision.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fwe-do-the-math-save-for-retirement-or-pay-off-credit-card-debt&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FWe%2520Do%2520the%2520Math-%2520Save%2520for%2520Retirement%2520or%2520Pay%2520Off%2520Credit%2520Card%2520Debt-.jpg&amp;description=We%20Do%20the%20Math%3A%20Save%20for%20Retirement%20or%20Pay%20Off%20Credit%20Card%20Debt%3F"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/We%20Do%20the%20Math-%20Save%20for%20Retirement%20or%20Pay%20Off%20Credit%20Card%20Debt-.jpg" alt="We Do the Math: Save for Retirement or Pay Off Credit Card Debt?" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/julie-rains">Julie Rains</a> of <a href="http://www.wisebread.com/we-do-the-math-save-for-retirement-or-pay-off-credit-card-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-retiring-with-debt-isnt-the-end-of-the-world">Why Retiring With Debt Isn&#039;t the End of the World</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-for-retirement-when-you-are-unemployed">How to Save for Retirement When You Are Unemployed</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/all-the-ways-minimum-payments-are-evil">All the Ways Minimum Payments Are Evil</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-one-third-of-americans-havent-saved-for-retirement">Why One-Third of Americans Haven&#039;t Saved for Retirement</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management Retirement 401(k) APR bills calculating comparisons interest rates nest egg Paying Off Debt Thu, 18 May 2017 08:30:15 +0000 Julie Rains 1949201 at http://www.wisebread.com How a Credit Card Cash Advance Costs You More Than a Purchase http://www.wisebread.com/how-a-credit-card-cash-advance-costs-you-more-than-a-purchase <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-a-credit-card-cash-advance-costs-you-more-than-a-purchase" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-625782024.jpg" alt="Learning how a credit card cash advance costs more" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Credit cards are all about convenience. With one swipe, anything we want or need is right at our fingertips; and that includes cash. That convenience comes at a steep price, however &mdash; quite literally.</p> <p>Credit cards call it a &quot;cash advance&quot; when you use them to take cash out at an ATM, or use one of their convenience checks to pay for purchases (for example, when the vendor doesn't take credit cards, but will take a check).</p> <p>Here is what you need to know before even considering a cash advance, and some alternative solutions for when you need funds fast.</p> <h2>What is a credit card cash advance?</h2> <p>Taking a cash advance is done much the same way as making a withdrawal with your debit card. Instead of taking your own money out of your bank account, however, you borrow directly from your credit card. You may also receive checks in the mail from your card issuer that allow you to make credit card purchases via check payments. Again, this is not your money &mdash; the checks will pull funds from your credit card account.</p> <h2>What happens when you take a cash advance</h2> <p>Most credit card issuers impose entirely different terms on cash advance transactions. First, you will be charged a transaction fee, which will either be a flat rate or a percentage of the cash advance you're withdrawing (typically between 2 percent and 5 percent). Additional ATM fees and foreign transaction fees if you're out of the country may apply as well.</p> <p>In addition to fees, you'll likely be hit with a much higher interest rate. In some cases, the APR can be double the percentage for regular purchases. This catches many people off guard, since they're unaware different terms apply for cash advances. The longer it takes you to pay off this amount, the more that hefty interest will pile up.</p> <p>There is no grace period for cash advances, either. Typically, you have a month or so to pay off a credit card purchase in full before accruing any interest charges. This doesn't happen with a cash advance &mdash; you pay interest starting the day you make the transaction.</p> <p>Credit card companies also typically impose a separate limit on the amount of money you can take in a cash advance. This will often be much lower than your actual credit card limit.</p> <h2>How much will this actually cost you?</h2> <p>Let's say you are going out for dinner with friends, and you need to get a quick $40 from an ATM using your credit card. First, you will be hit with the cash advance fee. Next, you will start incurring interest on that withdrawal immediately (possibly around 30%). Furthermore, the operator of the ATM may also impose its own fees, which can be anywhere between $3&ndash;$5 per transaction. You could be looking at anywhere from $10&ndash;$15 in fees for taking out $40 (and that's assuming you pay it off by the next billing cycle). As you can see, that $40 dinner could wind up costing you $15 extra. Now imagine if you were borrowing $1,000 or more!</p> <h2>Alternatives to credit card cash advances</h2> <p>Simply put, you should always use a debit card to access cash instead of a credit card. Most major banks offer debit cards that can be used at in-network ATMs for no additional fees. In addition, many banks and credit unions are part of a larger ATM network that allows transactions for no additional fees.</p> <p>If the issue is that you're simply short on money, or stuck living paycheck-to-paycheck, a cash advance is not the solution. Instead, consider ways you can bring in extra income. Perhaps you can take up a part-time or side gig, sell a few items on eBay, or throw a big garage sale. (See also: <a href="http://www.wisebread.com/how-to-come-up-with-1000-in-the-next-30-days?ref=seealso" target="_blank">How to Come Up With $1,000 in the Next 30 Days</a>)</p> <h2>When is it Ok to take a cash advance?</h2> <p>A cash advance isn't the best option, but if it's your <em>only</em> option in an emergency, take it. Be sure to understand that there will be fees involved and that you need to repay the money you borrowed as soon as possible.</p> <p>Cash advances should never be used for everyday expenses, &quot;fun&quot; money (shopping or gambling, for example), or even to make ends meet until your next paycheck. It can be all too easy to fall into a cycle of cash advances, which will ultimately lead to credit card debt. (See also: <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=seealso" target="_blank">Fastest Way to Pay Off $10K in Credit Card Debt</a>)</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jason-steele">Jason Steele</a> of <a href="http://www.wisebread.com/how-a-credit-card-cash-advance-costs-you-more-than-a-purchase">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-a-balance-transfer-offer-a-good-deal">Is a Balance Transfer Offer a Good Deal?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-scary-facts-about-credit-card-debt">6 Scary Facts About Credit Card Debt</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/i-dont-love-capital-one-how-to-get-a-lower-apr-or-possibly-not">How to Get a Lower APR, or Possibly Not</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-buy-a-car-with-a-credit-card">Should You Buy a Car With a Credit Card?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards APR borrowing money cash advance debt emergencies fees interest rates limits transactions Fri, 14 Apr 2017 08:30:14 +0000 Jason Steele 1925859 at http://www.wisebread.com 8 Most Common Mistakes When Doing a Balance Transfer to Eliminate Debt http://www.wisebread.com/8-most-common-mistakes-when-doing-a-balance-transfer-to-eliminate-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-most-common-mistakes-when-doing-a-balance-transfer-to-eliminate-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-497316392.jpg" alt="Learning common mistakes when doing a balance transfer" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Many credit cards offer 0% APR promotional financing on balance transfers, allowing you to <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?ref=internal" target="_blank">move debt from high-interest cards</a> onto one that offers zero interest for an introductory promotional period. These promo periods are nothing to sneeze at. They can last as long 21 months.</p> <p>So what's the catch? The truth is that <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=internal" target="_blank">balance transfer offers</a> can be incredibly valuable, but only when you use them properly and avoid making some common mistakes.</p> <h2>1. Assuming You'll Get the Best Balance Transfer Deal<strong> </strong></h2> <p>You might not always be approved for the balance transfer card you want. For example, the best 0% APR deals are only given to those with <a href="http://www.wisebread.com/5-best-credit-cards-for-people-with-excellent-credit?ref=internal" target="_blank">excellent credit</a>. While you may have had excellent credit in the past, having a large balance for a long time might have caused your credit score to slip. (See also: <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score?ref=seealso" target="_blank">One Ratio Is Key to a Good Credit Score</a>)</p> <p>Even if you are approved for the card, it may come with a credit line that's substantially lower than you need. If that's the case, you may want to consider applying for a second balance transfer card.</p> <h2>2. Trying to Transfer a Balance From the Wrong Card</h2> <p>Consumers sometimes don't realize that you can't transfer a balance between two cards issued by the same bank. So if you have an outstanding balance on your <a href="http://www.wisebread.com/get-cash-back-for-every-purchase-chase-freedom-unlimited-review?ref=internal" target="_blank">Chase Freedom Unlimited card</a>, you can't open up a new <a href="http://www.wisebread.com/chase-slate-visa-review?ref=internal" target="_blank">Chase Slate card</a> and expect to transfer your balance to it.</p> <p>Keep this in mind before you apply for a balance transfer card. Every time you apply for a credit card your credit score takes a little hit. It can usually recover fairly quickly, but there's no need to ding it unnecessarily for a card that doesn't even serve your needs. (See also: <a href="http://www.wisebread.com/which-balance-transfer-credit-card-is-the-best-for-you?ref=seealso" target="_blank">How to Choose a Balance Transfer Card</a>)</p> <h2>3. Overlooking Balance Transfer Fees</h2> <p>Almost all credit cards charge a fee when you make a transfer, except for a few notable cards that <a href="http://www.wisebread.com/5-best-credit-cards-with-no-balance-transfer-fees?ref=internal" target="_blank">don't charge balance transfer fees</a>. Typically the fee is 3% of the transfer amount, but it could be as high as 5%. If your balance is small enough that you can pay it off within a few months, you're probably better off not transferring it to a new card.</p> <h2>4. Delaying Your Balance Transfer</h2> <p>You'll usually have 60 or 90 days to transfer your balance to the new card. After that the deal expires. Transfer the balance as soon as you can to get the most use of the promotional 0% period and cut down on the number of days your balance is accruing interest on your old card. Transferring your balance early will also ensure you don't forget about the deal and miss it altogether.</p> <h2>5. Misunderstanding How New Purchases Are Treated</h2> <p>If you make a new purchase on a balance transfer card, it will be subject to the card's regular interest rate unless the card specifically offers <a href="http://www.wisebread.com/5-best-credit-cards-with-0-apr-for-purchases?ref=internal" target="_blank">0% interest on purchases</a>, too. That means you've got two balances on the card: the interest-free transferred balance and the new purchase balance.</p> <p>By law, credit card issuers must apply any payments above the minimum to the balance with the highest interest rate first. But they can apply your <em>minimum payment</em> to whichever balance they choose, which of course will be the one with no interest charges. As a result, you'll still incur interest on your new purchases.</p> <p>Bottom line: It's best not make new charges on the balance transfer card unless it offers interest-free financing on new purchases as well.</p> <h2>6. Paying Late</h2> <p>It's always important to pay your bills on time, but it's even more so with promotional balance transfer offers. Pay late and you may find your 0% offer revoked, subjecting you to the card's regular higher interest rate way before you're ready for it. Add to that late fees the card may impose, and you've got an expensive mistake.</p> <h2>7. Stopping Payments on Your Old Card Too Soon</h2> <p>What some cardholders don't realize is that your balance transfer may not be completed immediately. It can take up to two weeks to process the transfer. Even if you've initiated a balance transfer, you will still need to make payments on your old card until you've confirmed that it's been paid off. Don't worry about overpaying &mdash; credit cards are very good about refunding you any overage you might have submitted during the transition.</p> <h2>8. Using a Balance Transfer Offer to Rack Up More Debt</h2> <p>Those 0% APR balance transfer offers are your chance to <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=internal" target="_blank">get out of debt</a>, but unfortunately, many people squander that chance and continue to rack up debt. They can't resist the temptation of having an empty balance on their old card, so they keep making charges on it that they can't pay off right away.</p> <p>Instead, use balance transfer deals as part of a <a href="http://www.wisebread.com/5-day-debt-reduction-plan-pay-it-off?ref=internal" target="_blank">comprehensive debt repayment plan</a>. You should view the end of these limited time offers as a deadline for paying off your entire balance, knowing that 100% of each payment you make during this time will go toward your principle.</p> <p>See also: <a href="http://www.wisebread.com/5-ways-to-pay-off-high-interest-credit-card-debt?ref=seealso" target="_blank">5 Ways to Pay Off High Interest Credit Card Debt</a></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jason-steele">Jason Steele</a> of <a href="http://www.wisebread.com/8-most-common-mistakes-when-doing-a-balance-transfer-to-eliminate-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/i-dont-love-capital-one-how-to-get-a-lower-apr-or-possibly-not">How to Get a Lower APR, or Possibly Not</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-interest-rates-are-about-to-go-up">Your Interest Rates Are About to Go Up</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/credit-card-fees-hidden-and-otherwise">Credit Card Fees: Hidden and Otherwise</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/everything-you-didn-t-understand-about-credit-card-interest-grace-periods-and-penalty-aprs">Everything You Didn’t Understand About Credit Card Interest, Grace Periods, and Penalty APRs</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards APR balance transfer debt eliminate debt financing grace period promotional period Fri, 24 Feb 2017 10:30:36 +0000 Jason Steele 1896814 at http://www.wisebread.com The 25 Best Credit Cards From Credit Unions http://www.wisebread.com/the-best-credit-cards-from-credit-unions <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-best-credit-cards-from-credit-unions" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_smile_credit_card_588598074.jpg" alt="Woman using best credit cards from credit unions" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Credit unions have come a long way from their local, affinity group roots. These days credit unions offer all of the convenience and service of their much larger brethren, but usually at lower cost &mdash; and often with more personal customer service. Joining a credit union has never been easier, as most credit unions make membership available to almost anyone through affiliated nonprofits and groups. Of course, credit cards are among the banking products a credit union will offer.</p> <p>We've collected 25 of the best credit union credit cards on offer, many equal or superior to big bank cards. Have a look, and then decide if it's time to finally <a href="http://www.wisebread.com/9-good-reasons-to-choose-a-credit-union-instead-of-a-bank">dump your bank and join a credit union</a>.</p> <h2>Our Top 10 Credit Union Credit Cards</h2> <p>The 10 cards at the top of our list feature relatively low interest rates and familiar credit card features and perks.</p> <h3>State Department Federal Credit Union: Visa Platinum Card</h3> <p>The SDFCU offers a pair of Platinum Visa cards with several attractive benefits, including no balance transfer fees, and a rewards program called &quot;Flexpoint.&quot; Variable interest rates range between 7.49% and 15.24%, depending on credit score. The SDFCU is open to employees of the US State Department and their families, affiliated companies, and members of the American Consumer Council, which anyone can join.</p> <h3>GTE Financial Credit Union: Visa Platinum Card</h3> <p>The Platinum Visa from GTE Federal Credit Union offers attractive interest rates (8.49% for the best credit scores) and no balance transfer fees. Many credit union cards are shy with the rewards points, but this card features 2x and 3x points on promotional purchases throughout the year. Visa Alerts and Travel and Baggage insurance round out the perks. Membership in the GTEFCU is through employers, family members, or by joining GTE's CU Savers club.</p> <h3>Air Force Federal Credit Union: Visa Platinum Card<strong> </strong></h3> <p>You don't have to be a pilot to enjoy the benefits of the AFFCU Platinum Visa.There's no annual fee for this card, relatively low interest rates (starting at 8% for those with excellent credit scores), and 2,500 bonus CURewards points just for signing up. Membership is open to military service personnel and their families, government employees and their families, DOD contractors, and members of the Airman Heritage Foundation, which anyone can join for a fee.</p> <h3>Navy Federal Credit Union: cashRewards Credit Card</h3> <p>This card features no annual fee and an attractive cash back rewards program that returns 1.5% for every dollar spent. Interest rates start at 9.9%, so be sure to take advantage of the rewards while keeping balances at zero. There are no annual fees, no balance transfer fees, and no foreign transaction fees with this card. Membership is open to current and former service members, DOD civilians, and their families.</p> <h3>Pentagon Federal Credit Union: Platinum Rewards Visa Signature Card</h3> <p>The relatively high interest rates on this card (starting at 10.24%), make it an unwise choice for cardholders who carry a balance. For those who can keep balances low, the attractive rewards program can pay well, with 5x points for gasoline purchases and 3x for groceries. No annual fee and no foreign transactions fee keep the cost of this card down. PenFed membership is open to service members and their families, affiliate organizations, and members of Voices for America's Troops or the National Military Family Association, both of which anyone can join for a one-time fee.</p> <h3>Pentagon Federal Credit Union: Premium Travel Rewards American Express</h3> <p>As with the other PenFed card on this list, interest rates aren't the lowest, but the rewards are attractive, especially for frequent travelers. This card features a 12 month 0% balance transfer APR and pays 20,000 bonus points if new cardholders spend $2,500 in the first three months. There's no annual fee and no foreign transaction fees. PenFed membership is open to service members and their families, members of affiliate organizations, and members of Voices for America's Troops or the National Military Family Association, which anyone can join for a one-time fee.</p> <h3>Navy Federal Credit Union: Go Rewards Visa Signature Card</h3> <p>This Visa Signature card offers a decent rewards program &mdash; 3x points for restaurants, 2x for gasoline and 1x for everything else &mdash; at the cost of relatively high interest rates (9.74% to 18%, depending on credit score). There is no annual fee, no balance transfer fee, and no foreign transaction fee. Membership is open to current and former service members, DOD civilians, and their families.</p> <h3>Affinity Plus Credit Union: Visa Premier Classic</h3> <p>This no frills card from Affinity Plus Credit Union offers relatively low interest rates (8.65% to 18%, depending on creditworthiness), no annual fee, and no balance transfer fee. Other perks include a Rental vehicle damage waiver and Visa spending alerts. Membership is open to employees of the State of Minnesota, affiliate organizations, and members of the Affinity Plus Foundation, which anyone can join for a one-time fee.</p> <h3>NASA Federal Credit Union: Visa Platinum Advantage Rewards</h3> <p>This basic rewards card offers a point per dollar spent, which are redeemable for travel and merchandise. There is no annual fee and no balance transfer fee. Interest rates range from 10.17% to 18%, with a balance transfer rate of 7.90% on transfers made in the first 90 days. Membership is open to NASA employees and their families, affiliate organizations, and members of the National Space Society, which is free to join.</p> <h3>McGraw-Hill Federal Credit Union: Visa Platinum Card</h3> <p>This Platinum Visa card features interest rates between 9.9% and 18%, which is middle of the pack for this collection of cards. There is no annual fee. The rewards program requires a separate login on the credit union's website. The card offers Visa services not every credit union card offers, such as roadside assistance and car rental insurance. Membership is open to employer groups, members of their families, and members of VOICE foundation, which anyone can join.</p> <h2>Other Credit Union Credit Cards to Consider</h2> <p>If none of the above suit your needs, consider one of these.</p> <h3>Pentagon Federal Credit Union: Gold Visa Card</h3> <p>No frills, no fees, and relatively low interest rates (8.99% to 18%).</p> <p>PenFed membership is open to service members and their families, affiliate organizations, and members of Voices for America's Troops or the National Military Family Association, which anyone can join for a one-time fee.</p> <h3>Pentagon Federal Credit Union: Platinum Cash Rewards Visa Card</h3> <p>Cash back on gas of 3% or 5%, depending on which card you qualify for (Standard or Plus).</p> <p>PenFed membership is open to service members and their families, affiliate organizations, and members of Voices for America's Troops or the National Military Family Association, which anyone can join for a one-time fee.</p> <h3>Pentagon Federal Credit Union: Promise Visa Card</h3> <p>No fees, relatively low interest rates (8.99% to 18%).</p> <p>PenFed membership is open to service members and their families, affiliate organizations, and members of Voices for America's Troops or the National Military Family Association, which anyone can join for a one-time fee.</p> <h3>Pentagon Federal Credit Union: Defender Visa Signature Card</h3> <p>Cash back on all purchases of 1.5% and $100 bonus credit if new cardholders spend $1500 in the first three months.</p> <p>PenFed membership is open to service members and their families, affiliate organizations, and members of Voices for America's Troops or the National Military Family Association, which anyone can join for a one-time fee.</p> <h3>Lake Michigan Credit Union: Prime Platinum Visa Card</h3> <p>This card offers a relatively low interest rate (Prime + 3.00%) and no annual fee.</p> <p>Membership is open residents of Michigan, family members, and members of the ALS foundation, which requires a one-time fee.</p> <h2>Lake Michigan Credit Union: Max Rewards Visa Card</h2> <p>Cash back of 3% on gas (up to $500 per month), 2% on groceries (unlimited) and 1% on everything else (unlimited), redeemable via the CURewards program. No annual fee and no balance transfer fee.</p> <p>Membership is open residents of Michigan, family members, and members of the ALS foundation, which requires a one-time fee.</p> <h3>NASA Federal Credit Union: Visa Platinum Cash Rewards</h3> <p>Unlimited 1.5% cash back on all purchases. No annual, balance transfer, or foreign transaction fees.</p> <p>Membership is open to NASA employees and their families, affiliate organizations, and members of the National Space Society, which is free to join.</p> <h3>Affinity Plus Credit Union: Visa Premier Select Rewards</h3> <p>No annual or balance transfer fees. Earn one CURewards point per dollar spent, Visa Signature perks such as travel accident insurance and cell phone protection.</p> <p>Membership is open to employees of the State of Minnesota, affiliate organizations, and members of the Affinity Plus Foundation, which anyone can join for a one-time fee.</p> <h3>Apple Federal Credit Union: Visa Platinum</h3> <p>Low variable interest rates (5.99% to 18%) and no penalty APR. No annual, balance transfer, or foreign transaction fees.</p> <p>Membership in the credit union is open to anyone who lives, works, worships, volunteers, or attends school in several Northern Virginia counties, their families, and affiliated employee groups.</p> <h3>Apple Federal Credit Union: Signature Reward Visa</h3> <p>No annual, balance transfer, or foreign transaction fees. Earn 3x points on gas, 2x on groceries and 1x on everything else.</p> <p>Membership in the credit union is open to anyone who lives, works, worships, volunteers, or attends school in several Northern Virginia counties, their families, and affiliated employee groups.</p> <h3>Kitsap Credit Union: Visa Gold Card</h3> <p>Low variable APR (Prime +2.9%) and no annual, balance transfer, or foreign transaction fees.</p> <p>Membership is open to people who live work, or worship in the state of Washington.</p> <h3>Abri Credit Union: Visa Platinum Credit Card</h3> <p>Low interest rates (Prime + 3.9%), no annual, balance transfer, or foreign transaction fees. Promotional balance transfer rate of 1.99% for six months.</p> <p>Membership is open to people who live in select Chicagoland counties and their families.</p> <h3>Fort Community Credit Union: Visa Platinum Credit Card</h3> <p>Low variable APR (Prime + 3.99%), no annual, balance transfer, or foreign transaction fees. Cash back of 1% on all purchases.</p> <p>Membership is open to people who live and work in select counties in and around Milwaukee, Wisconsin, and their families.</p> <h3>America First Credit Union: Visa Platinum Credit Card</h3> <p>Cash back of 1.5% on all purchases, no annual or balance transfer fees.</p> <p>Membership is open to those who live, work, or worship in select Utah, Arizona, and Nevada counties.</p> <h3>Suncoast Credit Union: Reward Platinum Visa</h3> <p>Variable interest rates starting at 8.9%, one rewards point for every dollar spent, redeemable for travel and merchandise. No annual or balance transfer fees.</p> <p>Membership is open to those who live or work in select Florida counties and their families.</p> <h3>Alliant Credit Union: Visa Platinum Credit Card</h3> <p>Introductory APR of 0% for 12 months; variable after (9.74% to 21.74%). No annual fee, no balance transfer fee.</p> <p>Membership is open to select employer groups, people who live or work in select Chicagoland counties, or members of a nonprofit, which anyone can join for a one-time fee.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/greg-go">Greg Go</a> of <a href="http://www.wisebread.com/the-best-credit-cards-from-credit-unions">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-dirty-secrets-of-credit-cards">The Dirty Secrets of Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-a-credit-card-cash-advance-costs-you-more-than-a-purchase">How a Credit Card Cash Advance Costs You More Than a Purchase</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-a-balance-transfer-offer-a-good-deal">Is a Balance Transfer Offer a Good Deal?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/credit-card-fees-hidden-and-otherwise">Credit Card Fees: Hidden and Otherwise</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The Best 0% Balance Transfer Credit Cards</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards APR cash back credit unions interest rates rewards cards Sat, 28 Jan 2017 01:09:38 +0000 Greg Go 1882265 at http://www.wisebread.com 5 Ways to Pay Off Your Student Debt Faster http://www.wisebread.com/5-ways-to-pay-off-your-student-debt-faster <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-to-pay-off-your-student-debt-faster" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/new_grad_debt_100645843.jpg" alt="New grad finding ways to pay off student debt faster" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Plenty of us face student debt payments every month. In fact, in the United States an <a href="http://www.marketwatch.com/story/americas-growing-student-loan-debt-crisis-2016-01-15">estimated 40 million people</a> have student loan debt. With the rising cost of education, loans are becoming an increasingly common way for people to pay for school.</p> <p>While compounding debt may feel overwhelming, paying off your student debt isn't impossible &mdash; and you may be able to pay it off faster than you think. There are a few advantages that come along with paying off your debt faster. The sooner you reduce those balances, the sooner you'll stop paying interest on them. And once your debts are all paid off, you can feel good about putting that money toward something else.</p> <p>Here are some easy steps you can take that will help you pay off your student debt faster, saving you money in the long run.</p> <h2>Refinance and Consolidate Your Loans</h2> <p>If you've never <a href="http://www.wisebread.com/what-s-the-difference-between-student-loan-refinancing-and-consolidation?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=student">refinanced your student loans</a>, consider that it may be a good way to save a lot of money and help you to pay off loans faster. With <a href="http://www.wisebread.com/3-private-lenders-that-can-really-save-you-money-on-your-student-loans?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=student">online lenders like CommonBond</a>, you can save thousands through lower APRs.</p> <p>You may also want to consolidate multiple loans so that you're making a single monthly payment. This will simplify your payment process, and you'll further benefit from a lower APR when it applies to all of your loans &mdash; not just one of them.</p> <h2>Pay Off Your Student Debt With a Credit Card</h2> <p>You can actually put your monthly loan payment on a credit card and earn rewards for cash or travel. But don't do this if you can't pay off your balance in full each month. You'll end up paying more in interest than any amount of rewards you could earn. (See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-for-college-students?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=student">Best Credit Cards for College Students</a>)</p> <h2>Make an Extra Principal Payment</h2> <p>This is an extra payment that you can make on a schedule that you determine &mdash; every two weeks, for instance. If you're making extra payments, it will reduce the time it takes to pay off your loan in full.</p> <h2>Set a Goal and Stick to It</h2> <p>It's really important to figure out a budget that makes sense given your personal situation. You'll need to take into account monthly expenses, like rent, food, a car payment, etc.</p> <p>From there, consider how much money you can put toward paying off your student debt. Remember that the more money you pay toward your loan, the faster you'll be able to pay it off. So you should also consider how much time you'd like to take to pay off your loan. Then you can factor in the money you'll save in the long run by paying off your debt sooner rather than later.</p> <h2>Get a Second Job or Side Hustle</h2> <p>If your budget falls a bit short on cash, you can always look into getting a second job and put those funds toward paying off your student debt. The more time you spend working, the less free time you'll have to spend your money, anyhow. And the effort and discipline you expend on acquiring or perfecting a second income stream will serve your career path and finances well in the future.</p> <p><em>How are you paying off your student loans?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/nick-wharton">Nick Wharton</a> of <a href="http://www.wisebread.com/5-ways-to-pay-off-your-student-debt-faster">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-things-you-need-to-know-about-deferring-student-loans">4 Things You Need to Know About Deferring Student Loans</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/what-is-student-loan-forbearance-anyway">What Is Student Loan Forbearance, Anyway?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-to-travel-when-you-have-student-loans">6 Ways to Travel When You Have Student Loans</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-valuable-rights-you-might-lose-when-you-refinance-student-loans">8 Valuable Rights You Might Lose When You Refinance Student Loans</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-get-trapped-by-these-higher-education-scams">Don&#039;t Get Trapped by These Higher Education Scams</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Education & Training APR consolidation debt interest monthly payments online lenders principal side jobs student loans Thu, 01 Sep 2016 09:30:34 +0000 Nick Wharton 1783722 at http://www.wisebread.com 6 Ways to Travel When You Have Student Loans http://www.wisebread.com/6-ways-to-travel-when-you-have-student-loans <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-ways-to-travel-when-you-have-student-loans" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_backpack_travel_87628739.jpg" alt="Woman finding ways to travel while paying student loans" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Student loans are a reality for millions of recent graduates and even some of us who have been out of school for a while. Americans alone have <a href="https://commonbond.co/blog/average-student-loan-debt-and-student-loan-refinancing/">1.36 trillion dollars</a> of student loan debt. That's second only to U.S. mortgage debt.</p> <p>Don't worry! There are plenty of ways to manage your student debt and continue doing what you love. With these tips, you can get out and spend your time traveling while making all of your payments on time!</p> <h2>1. Take a Look at Your Loans Before You Go</h2> <p>Getting ready for a big trip is actually a very good time to re-evaluate your student loans (and the rest of your finances), especially because it has the potential to save you a lot of money. By <a href="http://www.wisebread.com/should-you-refinance-your-student-loan">refinancing your student loans</a> you could save thousands. That's because you may be able to get a better APR, and you can also change the terms of your loan so that your monthly payment feels more manageable.</p> <p>Even a small difference in the interest rate can make a big difference over the time that you're paying off your loan. With <a href="http://www.wisebread.com/3-private-lenders-that-can-really-save-you-money-on-your-student-loans">online lenders like CommonBond</a>, you can get an APR starting as low as 2.14%. It only takes minutes to fill out the application, and you're under no obligation to change your loan once you get your free quote.</p> <p>That cash you're saving can easily go into your travel fund!</p> <h2>2. Consider Consolidating Your Loans</h2> <p>This second tip is closely linked to the first, since in the process of refinancing your loans, you may also want to <a href="http://www.wisebread.com/what-s-the-difference-between-student-loan-refinancing-and-consolidation">consolidate your loans</a>. This means that if you have multiple student loans, instead of paying, let's say, three separate bills every month, you can combine all of your existing loans into one.</p> <p>Consolidating your loans will help to simplify the payment process for you and reduce the time you spend every month administering and worrying about your loan payments.</p> <p>This is an especially important point for people planning to travel, since you're already going to have a lot of logistics to keep straight. The simpler you can keep your loan payments, the better.</p> <h2>3. Put Things in Perspective &mdash; And Into Your Budget!</h2> <p>It can be paralyzing to think about the total amount of money that you owe, especially if you know you're going to be spending the next 20 years of your life paying it off.</p> <p>It's more helpful to put things in perspective, so once you've refinanced your loans and you have a manageable monthly payment, treat that like you would any other monthly bill that you have to pay.</p> <p>Take it on a month-to-month basis and you won't feel as limited by the amount of money that you owe. When you're making your travel budget, simply factor in the monthly payment that you'll be making into your overall budget for the time you'll be traveling, and set aside that money before you go. That way, you won't feel like you have to scramble for funds at the last minute.</p> <h2>4. Start a Travel Fund</h2> <p>Figure out how much money you can commit to setting aside for travel every month. Then you can set up an automatic transfer into a special bank account that is dedicated just to travel expenses. Even if you're only putting in a few hundred dollars a month, you'll be surprised at how fast these funds can add up over time.</p> <p>See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-for-college-students?utm_source=wisebread&amp;utm_medium=seealso2&amp;utm_campaign=travel">Best Credit Cards for College Students</a></p> <h2>5. Create a Realistic Budget</h2> <p>You should think about how you like to travel and be honest with yourself. Frugal travel is not for everyone, so you should consider what your priorities are; maybe you will be just as satisfied going on a shorter trip and putting more emphasis on higher-end accommodations and fancy restaurant meals.</p> <p>If these types of comforts or luxuries don't matter to you, you can probably get by with a smaller budget, but on a longer trip. (See also: <a href="http://www.wisebread.com/savor-your-trip-and-save-big-with-these-5-slow-travel-tips">Save Big With These Slow Travel Tips</a>)</p> <p>Budgeting is all about striking a balance that works best for you while being realistic about how much you can afford to spend on your trip. By weighing these decisions before you leave, you'll eliminate a lot of money-related stress so that you can just enjoy your trip, knowing that you've already budgeted in the funds to cover your student loans.</p> <h2>6. Earn Extra Money for Travel</h2> <p>You're probably already getting excited to go, so if you want to speed up the process you can always consider earning a little extra money to cover your travel expenses.</p> <p>It's up to you what skills you have and what kind of work you enjoy, but maybe you want to consider getting a second part-time job and putting the money you earn right into your travel account!</p> <p>Depending on your professional skill set, you can also consider taking on some <a href="http://www.wisebread.com/22-websites-that-will-pay-you-to-write-for-them">freelance gigs</a>, since they can be very flexible and add a little something extra to your normal paycheck. While you'll have less free time, this also means less time to be out spending money which can be a big help when you're trying to save money. There are also ways to <a href="http://www.wisebread.com/15-ways-to-make-money-while-you-travel">make money while you&rsquo;re traveling</a>.</p> <h2>Don't Let Debt Stop You</h2> <p>There's no reason to let student debt paralyze you, and there are simple steps you can take if you're passionate about traveling. It will take a bit of good strategy, combined with some hard work and a proper execution of your plan, but if you're willing to put in the time you can really reap the rewards on your next trip (and even at home).</p> <h2 style="text-align: center;">Like this post? Pin it!</h2> <p>&nbsp;</p> <p style="text-align: center;"><a href="//www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-ways-to-travel-when-you-have-student-loans&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%20Ways%20to%20Travel%20When%20You%20Have%20Student%20Loans.jpg&amp;description=6%20Ways%20to%20Travel%20When%20You%20Have%20Student%20Loans" data-pin-do="buttonPin" data-pin-config="above" data-pin-color="red" data-pin-height="28"><img src="//assets.pinterest.com/images/pidgets/pinit_fg_en_rect_red_28.png" alt="" /></a> </p> <!-- Please call pinit.js only once per page --><!-- Please call pinit.js only once per page --><script type="text/javascript" async defer src="//assets.pinterest.com/js/pinit.js"></script></p> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/6%20Ways%20to%20Travel%20When%20You%20Have%20Student%20Loans.jpg" width="250" height="374" alt="" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/amanda-gokee">Amanda Gokee</a> of <a href="http://www.wisebread.com/6-ways-to-travel-when-you-have-student-loans">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-pay-off-your-student-debt-faster">5 Ways to Pay Off Your Student Debt Faster</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-valuable-rights-you-might-lose-when-you-refinance-student-loans">8 Valuable Rights You Might Lose When You Refinance Student Loans</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-unexpected-benefits-of-solo-travel">6 Unexpected Benefits of Solo Travel</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-times-student-loan-refinancing-can-save-you-big">4 Times Student Loan Refinancing Can Save You Big</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-stop-student-loans-from-ruining-your-life">How to Stop Student Loans From Ruining Your Life</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Education & Training Travel APR budgeting consolidation debt refinancing strategy student loans travel funds trips Mon, 22 Aug 2016 10:00:13 +0000 Amanda Gokee 1775891 at http://www.wisebread.com Why Rent-to-Own Is a Bad Idea http://www.wisebread.com/why-rent-to-own-is-a-bad-idea <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/why-rent-to-own-is-a-bad-idea" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_shopping_computers_84494997.jpg" alt="Woman learning why rent-to-own is a bad idea" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Rent-to-own plans may seem like a good idea at first. But once you look into the total cost, it is apparent that these plans are just too good to be true. In fact, according to Dave Ramsey, it is &quot;one of the worst moves you can make with your money.&quot;</p> <h2>How the Plan Works</h2> <p>With a rent-to-own plan, you can enjoy the freedom of making a large purchase with smaller weekly or monthly payments, over a prolonged period of time. The payments include the interest charged and a portion of the principal. Repaying this obligation is similar to repaying a credit card obligation.</p> <h2>It'll Cost You in the End</h2> <p>The problem with these programs is the finance charge. Even using a credit card with a 20% APR would save you money compared to a rent-to-own program, which you will need to pay off over a significant amount of time (on a weekly, semimonthly, or monthly basis). The longer your contract is, the more you will pay in finance charges.</p> <p>Rent-to-own plans are significantly more expensive than outright purchases. By paying the purchase cost and effective interest rate over time, you can expect to spend significantly more than the retail price. In fact, according to Consumer Affairs, &quot;Even in the best-case scenario, you'll pay at least <a href="https://www.consumeraffairs.com/news/rent-to-own-is-an-expensive-way-to-do-either-110613.html">twice the standard retail price</a>.&quot; (See also: <a href="http://www.wisebread.com/this-is-how-much-a-rent-to-own-tv-really-costs?ref=seealso">This Is How Much a &quot;Rent-to-Own&quot; TV Really Costs</a>)</p> <h2>Rent-to-Own Programs Are Unregulated</h2> <p>Rent-to-own programs do not require credit and are not a form of credit, so they are <a href="https://www.ftc.gov/reports/survey-rent-own-customers">excluded from regulation</a> by federal law. While some states do effectively regulate the purchase agreements, there are other states that have no regulations at all, which means that the buyer is taking on all the risk.</p> <h2>What About Missed Payments?</h2> <p>Some rental centers are lenient about missed payments and might just charge a late payment fee, but will allow you to keep the item. However, there are some rental centers that will repossess the item should you miss a payment. In this case, you will experience the worst of both worlds. You will lose the money that you invested toward the purchase of the item, and the item will be repossessed.</p> <h2>Unexpected Additional Fees</h2> <p>If you will only be using the item for a short amount of time, such as for a prolonged business trip, make sure the rental center you choose offers free repairs, delivery, pick up, and set up. This should be standard because the last thing you want is to be paying additional fees on top of the already exorbitant prices. These unexpected additional fees can really add up, so make sure to inquire about them before signing any agreements.</p> <h2>Is It Ever a Good Idea?</h2> <p>The only time rent-to-own may be a good idea (for the short-term) is in the following situations:</p> <ul> <li>You are traveling for business and need furniture and appliances for a short period of time. The benefit of rent-to-own programs is you only pay for the item as long as you need it, and you can stop making payments once you are ready to return the item.<br /> &nbsp;</li> <li>You need appliances or furniture right away and you can't wait until you have the money to purchase them.<br /> &nbsp;</li> <li>You frequently get bored with your appliances and like to upgrade often. Some rental centers will allow you to upgrade to newer products and technologies at no extra cost, as often as you want. In this case, you can think of it almost like leasing a car.</li> </ul> <h2>Bad Credit or No Credit?</h2> <p>Rent-to-own will allow you to buy items without credit, so if you have bad credit or no credit, it will be much easier to sign up for a rent-to-own program rather than trying to get your new TV financed. With a rental center, they will not check your credit or base their decision on mistakes you've made in the past. This also means that it won't show up on your credit, so the plan won't hurt or help your current situation.</p> <p>Certain rental centers, like Rent-A-Center, will allow you to purchase the item within 90 days or less with no interest charges. This means you can purchase an item with 0% APR over three months. If you can pay off the item within three months, then this may be a good idea for you.</p> <h2>What About Large Purchases?</h2> <p>If you can't qualify for a mortgage loan, a rent-to-own agreement will allow you to live in your dream home today, with the option to purchase it down the road. However, this can be a pitfall for renters and may end up costing you more in the end. (See also: <a href="http://www.wisebread.com/5-things-you-need-to-know-when-renting-to-own-a-home?ref=seealso">5 Things You Need to Know When Renting-to-Own a Home</a>)</p> <p>Rent-to-own can apply to vehicles as well. The agreement is similar to a leasing agreement, except the money you pay every week or month will go toward the eventual purchase price of the vehicle. Whereas with a leasing agreement, your payment does not go toward the purchase price and you need to return the vehicle at the end of the term.</p> <h2>Consider Layaway Plans Instead</h2> <p>Instead of signing on to a rent-to-own agreement, consider a layaway plan. With a layaway plan, you can split the cost up into payments that meet your budget until it is paid off. Generally, you will need to make a down payment (usually 10%&ndash;20% of the purchase price) and can then arrange payments on a weekly, biweekly, or monthly basis.</p> <p>A layaway plan is almost identical to a rent-to-own plan, except you won't have to worry about the high finance charges, and with layaway, your item will stay in the store until you have paid it off. There is generally a small service fee involved, but it is nothing compared to the finance charges you would face with rent-to-own.</p> <p><em>Do you have any positive or negative experiences with rent-to-own programs? Please share your thoughts in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/why-rent-to-own-is-a-bad-idea">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-9-everyday-products-with-the-biggest-markups">The 9 Everyday Products With the Biggest Markups</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-buy-a-car-with-a-credit-card">Should You Buy a Car With a Credit Card?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-important-things-you-should-know-about-balance-transfer-cards">7 Important Things You Should Know About Balance Transfer Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-a-credit-card-cash-advance-costs-you-more-than-a-purchase">How a Credit Card Cash Advance Costs You More Than a Purchase</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-is-how-much-a-rent-to-own-tv-really-costs">This Is How Much a &quot;Rent-to-Own&quot; TV Really Costs</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Shopping APR bad credit fees monthly payments rent a center rent to own rip-offs waste of money Mon, 08 Aug 2016 09:30:33 +0000 Andrea Cannon 1767116 at http://www.wisebread.com All the Ways Minimum Payments Are Evil http://www.wisebread.com/all-the-ways-minimum-payments-are-evil <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/all-the-ways-minimum-payments-are-evil" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_laptop_credit_card_88164697.jpg" alt="Man learning ways minimum payments are evil" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Anyone who has a credit card is familiar with minimum payments. Most credit cards don't require cardholders to pay off their balances in full every month, but they <em>do</em> require cardholders to pay some minimum amount. This can be as low as 2% to 3% of the outstanding balance, or a minimum of $25 or $35 &mdash; whichever is higher.</p> <p>While paying the minimum technically keeps your account in good standing, there are negative consequences to this decision. Here are five reasons why minimum payments are evil and should be avoided.</p> <h2>They Keep You in Debt</h2> <p>Minimum payments may keep your credit card bills affordable, but you have to consider the big picture. In the end, minimum payments don't benefit your bottom line &mdash; they benefit your credit card company.</p> <p>The truth is, minimum payments are a sneaky trick designed to keep you a slave to credit card debt. The longer you keep a balance on your cards, the more money your creditors earns off you. If you only pay your minimums every month, you'll carry your balances for years to come. For example, if you have a credit card with a $2,000 balance and 17% interest rate, and you only make minimum payments each month (2% of your balance), it will take you <em>over 21 years</em> to pay it off. You'd have paid over $3500 in interest alone &mdash; and that's if you don't put additional purchases on the card.</p> <p>That may seem like a shock, but that's exactly why the minimum payment schedule was designed. Because they're taking a <em>percentage</em> of your balance, every month, the minimum payment required goes down. That does two things &mdash; encourages you to pay <em>less</em> so that you keep the balance longer, and it also tricks you into thinking that you're actually making progress paying off your debt. If you see that your payments are getting lower, you feel like your debt is getting smaller too. But you're actually hardly chipping away at the debt at all.</p> <p>If on the other hand, you pay $50 per month, it will take you five years to pay it off, with about $970 in interest. That's a huge difference compared to 21 years and $3500 in interest. Every little bit of extra you can put into your credit card debt will significantly cut down on your repayment time.</p> <p>If you can make reasonable plan and keep to your budget, a <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">balance transfer will put a pause on interest payments</a> and help you <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">pay off debt faster</a>.</p> <h2>Purchases Become More Expensive</h2> <p>Credit cards might be convenient, but they're also costly &mdash; and unfortunately, if you carry a balance from month-to-month and only make the minimum payment, you end up spending much more for every purchase made with the card. And once you leave a balance on your card, the grace period disappears and you immediately start accruing interest the moment you make your purchase. Grace periods are only active if there is no outstanding balance. (See also: <a href="http://www.wisebread.com/everything-you-didn-t-understand-about-credit-card-interest-grace-periods-and-penalty-aprs?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">Everything You Didn't Know About Credit Card Interest and Grace Periods</a>)</p> <p>If you have to make a large purchase, you can get a card with a <a href="http://www.wisebread.com/5-best-credit-cards-with-0-apr-for-purchases?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">0% introductory APR on purchases</a>. For a certain period, no interest is charged on your outstanding balance. This gives you time to pay off the purchase without interest. However, once the intro period is over, the regular APR will kick in. It's important to only use that opportunity if you know you can pay off the balance during the introductory APR time period.</p> <h2>Your Credit Score Can Suffer</h2> <p>In my younger days, I thought as long as I paid my minimum payments on time, my credit score was protected. I was young and dumb and didn't realize how other factors impact credit scoring.</p> <p>Paying only the minimum may not have a direct negative impact on your score, but it doesn't exactly help it, either. A high credit card balance can result in a higher <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">credit utilization ratio</a>, which is the percentage of outstanding debt in comparison to your available credit line. Credit utilization is the second biggest factor making up your credit score, and if your credit card balances exceed 30% of your available credit, your score will take a hit.</p> <p>You can lower your credit utilization ratio &mdash; and subsequently improve your credit score &mdash; by paying more than your minimums every month. Minimum payments are just that &mdash; minimums. Even if you only double or triple your minimum, this will chip away at what you owe and reduce how much you pay in interest significantly.</p> <h2>It Affects Other Areas of Your Financial Life</h2> <p>Paying only the minimum might not seem like a big deal, until you realize how this decision can impact other areas of your financial life. If you're only making your minimum and carrying a high balance on a credit card &mdash; resulting in a lower credit score &mdash; this affects the ability to get other types of financing. If you apply for a mortgage or an auto loan, lenders will take one look at your high balances and low score and consider you a risky applicant. There's a chance you won't qualify for some loans, or the bank might not offer favorable terms.</p> <h2>Minimum Payments Can Increase</h2> <p>Another problem with minimum payments is that they aren't carved in stone. Credit cards are a revolving type of credit account. As your balance goes up, so does the amount you owe. Your minimum payments might be manageable today. But if you continue to charge to your account and don't make any efforts to significantly decrease the balance, your minimum payments can increase. If you're already struggling with your budget just to meet the minimum payments, the most important thing is to sit down and make a <a href="http://www.wisebread.com/5-day-debt-reduction-plan-stop-waiting-for-tomorrow?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">debt repayment plan</a>. Otherwise, you'll be stuck in this cycle of debt for generations.</p> <p><em>Do you pay the minimums on your credit cards?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/all-the-ways-minimum-payments-are-evil">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-easy-first-steps-to-paying-off-debt">7 Easy First Steps to Paying Off Debt</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/debunking-8-common-credit-score-myths">Debunking 8 Common Credit Score Myths</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/we-do-the-math-save-for-retirement-or-pay-off-credit-card-debt">We Do the Math: Save for Retirement or Pay Off Credit Card Debt?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-surprising-ways-revolving-debt-helps-you">5 Surprising Ways Revolving Debt Helps You</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/best-of-personal-finance-credit-where-credit-is-due-edition">Best of Personal Finance: Credit Where Credit Is Due Edition</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management APR credit score credit utilization ratio interest rates minimum payments Fri, 22 Jul 2016 09:00:05 +0000 Mikey Rox 1756968 at http://www.wisebread.com Everything You Didn’t Understand About Credit Card Interest, Grace Periods, and Penalty APRs http://www.wisebread.com/everything-you-didn-t-understand-about-credit-card-interest-grace-periods-and-penalty-aprs <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/everything-you-didn-t-understand-about-credit-card-interest-grace-periods-and-penalty-aprs" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000044839186.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>One of the most important elements to consider when choosing a credit card is the interest rate or Annual Percentage Rate (APR). However, figuring out all the ins and outs of how credit cards charge interest can be confusing. In order to get the most out of your credit card, especially if you like to keep track of rewards programs and cash back opportunities, it&rsquo;s important to look at how your actions can affect the amount of interest you pay. When <a href="http://www.wisebread.com/ask-these-7-questions-to-help-choose-the-perfect-credit-card?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">selecting a credit card</a>, it&rsquo;s more than just choosing the <a href="http://www.wisebread.com/the-best-low-interest-rate-credit-cards?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=5x">lowest APR</a> or best rewards. Being aware of the aspects of credit card interest can mean more money in your pocket and less in interest payments.</p> <h2>Deferred Financing vs. Waived Interest</h2> <p>At first glance, it might seem you can&rsquo;t go wrong with a card with a <a href="http://www.wisebread.com/5-best-credit-cards-with-0-apr-for-purchases?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=5x">promotional 0% APR</a>. However, knowing the difference between deferred financing and waived interest could end up being worth hundreds of dollars.</p> <ul> <li><strong>Deferred interest</strong> is most likely the offer you come across directly from a store. For instance, you can currently take advantage of 0% deferred interest financing on Apple purchases for 6 months on purchases costing under $498. The interest accrues during the promo period, but you don&rsquo;t pay the interest unless you haven&rsquo;t paid off the balance by the end of the promotional period. Further, if any of your payments are late, you could also be billed all of the interest that accrued since you made the purchase. With deferred interest offers, you will be assessed <em>all of the accrued interest</em> if you don&rsquo;t pay your balance in full by the end of the offer.</li> </ul> <ul> <li><strong>Waived interest</strong>, on the other hand, is commonly offered by standard credit cards. If your credit card offers 0% interest that is waived, you are typically able to take advantage of the promotional period <em>without accruing interest</em>. If for some reason, you don&rsquo;t pay your balance in full when the promotional period ends, you just start to pay interest <em>on your balance</em> according to the card&rsquo;s APR at the moment.</li> </ul> <p>When interest is <em>deferred</em>, interest is still accruing. If you don&rsquo;t pay your balance in full, even if you just have $10 left on your balance, you get charged for <em>all the interest</em> during the period. But if the interest is <em>waived</em>, no interest gets calculated until the promotional period is over. Then interest will start being added <em>based on the balance you have left</em>.</p> <p>In either event, it&rsquo;s best to pay your balance off completely within the promotional period , but if there&rsquo;s any chance at all that you won&rsquo;t be able to pay your balance down during the designated period, it&rsquo;s best to make sure your interest is waived rather than deferred. Check your credit card conditions and especially take note of terms such as &ldquo;financing&rdquo; and &ldquo;deferred interest&rdquo; if you aren&rsquo;t sure.</p> <h2>Grace Period</h2> <p>The credit card&rsquo;s <strong>grace period</strong> is typically the amount of time between the end of a billing cycle and your payment due date. According to the <a href="http://www.consumerfinance.gov/askcfpb/47/what-is-a-grace-period-how-does-it-work.html">Consumer Financial Protection Bureau</a> (CFPB) credit card issuers must ensure that your statements are mailed or delivered at least 21 days before their due date. In order to take advantage of the grace period, you need to pay the entire balance in full before the due date.</p> <p>The grace period though, is surprisingly tricky to understand. The important detail to remember is that interest is charged <em>retroactively</em> if a purchase is not paid within its grace period. For example, you charge $1,000 on June 1. The statement closes on June 15, leaving you a 21 day grace period to pay that off. You make a payment on June 30 for $900. A reasonable person would assume that the bank would start charging interest on the $100 balance, starting at the new billing period. That is not the case.</p> <p>You will get hit with interest on the entire $1,000 for the duration of that billing cycle (from June 1 to June 15). That interest will be immediately posted to your account. Then, interest is continued to be calculated at $1,000 until the date the payment was posted to your account (probably around 5/2). At 5/2, your balance dropped to $100, and interest will then be calculated on the new balance, until the statement closes.</p> <p>Now, by leaving a balance on your account, you no longer get the grace period for new purchases. Because you have $100 on your balance, if you make another $500 purchase, the interest will start accruing on that $500 <em>immediately</em>.</p> <p>In order to reinstate your grace period, you&rsquo;ll need to pay off your balance <em>before</em> the statement closes (not when it closes and bills you), because interest accrues during the time the statement closes and your bill is due. If the new billing cycle starts with a zero balance, then the grace period will be reinstated.</p> <p>On more note on grace periods: Grace periods generally only apply to purchases, which is one of the many reasons that cash advances and credit card checks can be expensive. Because there is no grace period for cash advances, you start paying interest on the transaction date, even if you pay the balance of the advance in full before your next billing cycle. Plus, the APR for cash advances is usually higher than the purchase APR &ndash; often well over 20%.</p> <h2>Penalty APR</h2> <p>In addition to APRs, deferred financing, and grace periods, there is also a <strong>Penalty APR</strong> to consider when you use your credit card. Not all credit cards charge a Penalty APR, but if they do, it&rsquo;s important to understand how it can affect your payments.</p> <p>Penalty or default APRs vary and have changed according to the <a href="https://www.congress.gov/bill/111th-congress/house-bill/627">Card Act of 2009</a>. For consumer credit cards, a penalty APR can result in an increase to your interest rate if you miss a payment, make a late payment, or exceed your credit limit. For the most part, it means a significantly higher interest rate (often double what you start with) on new purchases. However, if your payments become 60 days late, the penalty APR can apply to your existing balance as well. However, if you end up in this situation, you aren&rsquo;t permanently stuck with the penalty APR. According to the Card Act, once your rate is increased the card issuer must reconsider the penalty APR in six months and in most instances your APR will return to the non-penalty APR after making the next six consecutive payments on time.</p> <p>Keep an eye on your fees and don&rsquo;t hesitate to call your credit card to ask for a fee to be waived or lowered if it was just a one time mistake and you&rsquo;ve been a good customer.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christina-majaski">Christina Majaski</a> of <a href="http://www.wisebread.com/everything-you-didn-t-understand-about-credit-card-interest-grace-periods-and-penalty-aprs">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-most-common-mistakes-when-doing-a-balance-transfer-to-eliminate-debt">8 Most Common Mistakes When Doing a Balance Transfer to Eliminate Debt</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/i-dont-love-capital-one-how-to-get-a-lower-apr-or-possibly-not">How to Get a Lower APR, or Possibly Not</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-important-things-you-should-know-about-balance-transfer-cards">7 Important Things You Should Know About Balance Transfer Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/lower-credit-card-rates-just-ask">Lower Credit Card Rates? Just Ask!</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-a-balance-transfer-offer-a-good-deal">Is a Balance Transfer Offer a Good Deal?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards APR credit card interest finance charge grace period Mon, 23 May 2016 10:30:06 +0000 Christina Majaski 1710058 at http://www.wisebread.com 7 Signs It's Time to Break Up With Your Credit Cards http://www.wisebread.com/7-signs-its-time-to-break-up-with-your-credit-cards <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-signs-its-time-to-break-up-with-your-credit-cards" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/credit_card_dollar_000079523783.jpg" alt="Man learning signs it&#039;s time to break up with his credit cards" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Just as unresolved conflicts can lead to a breakup in a relationship, there are signs of credit card misuse that should signal it's time to break up with your credit cards &mdash; at least for awhile.</p> <p>Here are seven signs to look out for.</p> <h2>1. You Can Only Afford the Minimum Payment</h2> <p>Prioritizing bills isn't easy. After paying the rent, grocery, water and electricity bills, and other basic necessities of life, it can be difficult to pay off a credit card bill, too. If you can only afford the minimum payment on the credit card, then you probably have some spending problems.</p> <p>Making only the minimum payment on a credit card will keep your account up to date and in good standing, and that's a good start. But it will take years to knock down the balance, and even longer if you continue charging purchases on the card.</p> <p>Here's an example: If you owe $5,000 on a credit card at 18% interest, paying the minimum amount due each month (assuming 3% of balance) will take you <strong>over 16 years</strong> to pay it off. Along with paying the $5,000 principal, you'll have paid $4,698.46 in interest. (See also: <a href="http://www.wisebread.com/the-best-low-interest-rate-credit-cards?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">Best Credit Cards with Low Interest Rates</a>)</p> <p>If instead you pay $200 each month, that will cut down the repayment time to under 3 years, at which point you&rsquo;d have paid $1,313.96 in interest.</p> <h2>2. You Play the Transfer Balance Shell Game</h2> <p>One way to get out of paying interest on a credit card balance is to <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">transfer it to a 0% APR balance transfer card</a>. You can save thousands of dollars in interest, but usually only for one year during the introductory period. After that, you're back to paying interest again.</p> <p>If you're constantly moving credit card balances to <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">0% APR cards</a> so you can avoid paying interest, it's a sign your credit card spending is out of control.</p> <p>It's one thing if you're using that year of no interest payments to pay off a credit card. But if you're still running up the balance, you're getting nowhere in paying off the debt. (See also: <a href="http://www.wisebread.com/what-you-must-know-before-transferring-credit-card-balances?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">What You Must Know Before Making a Balance Transfer</a>)</p> <h2>3. You're Maxed Out</h2> <p>Your credit cards have credit limits, and if you're close to those limits it can be difficult to extend more credit when you really need it &mdash; such as in an emergency.</p> <p>Maxing out your credit cards can also hurt your credit score because your <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">credit utilization ratio</a> &mdash; the percentage of available credit being used &mdash; should be under 30% for a top credit score.</p> <h2>4. You Make Impulse Buys on Credit</h2> <p>Credit cards are easy to pull out of a wallet or purse to pay for anything, from a candy bar or drink to a down payment on a new car. If you're using credit cards to buy anything you want whenever you see it, such as a sweater you see in a store window or an ice cream cone on a hot day out, then you're more likely to rack up debt faster without realizing it.</p> <p>Paying cash for such purchases can help you control spending. If you don't have the cash on you, then you won't be able to make the impulse buy when it pops up.</p> <h2>5. You Buy Things You Can't Afford</h2> <p>Along with impulse buys, credit card users can get in over their heads in debt by charging every expense &mdash; including ones they can't really afford.</p> <p>If you're using cash to buy groceries, for example, you're less likely to get that extra box of cookies if you don't have enough money with you. But with a credit card, the sky's the limit. (See also: <a href="http://www.wisebread.com/the-best-5-credit-cards-for-groceries?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">Credit Cards That Offer Cash Back for Groceries</a>)</p> <h2>6. You Hide Debt From Your Spouse</h2> <p>If getting the mail makes you anxious because your spouse may see your credit card bill, you have a debt problem and need to tackle it <em>together</em>.</p> <p>Hiding debt from your spouse can also hurt your relationship, so working together on this can solve two problems simultaneously.</p> <h2>7. You Have Credit Cards From Every Store</h2> <p>Store-branded credit cards can be enticing at the checkout counter. They often offer discounts of 20% or more on purchases that day, and approval is almost automatic.</p> <p>But they also have high interest rates of up to 29%, setting you up for more interest payments if you don't pay the balance in full each month. Store credit cards also offer an easy excuse to go shopping. (See also: <a href="http://www.wisebread.com/store-credit-cards-that-dont-suck?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">Store Credit Cards That Don&rsquo;t Suck</a>)</p> <p>And since a store's credit card can only be used at the issuing business &mdash; you can only use a Nordstrom card at Nordstrom stores, for example &mdash; you'll need credit cards from every store you shop at if you want to take advantage of the deals they offer.</p> <h2>What to Do</h2> <p>There are things you can do if you spot any of the above signs in your financial life. To recap, here are a few things to try before using your credit cards again:</p> <ul> <li>Seek credit counseling. The Federal Trade Commission offers advice on how to find a <a href="https://www.consumer.ftc.gov/articles/0153-choosing-credit-counselor">reputable credit counseling agency</a>.<br /> &nbsp;</li> <li>Put your credit cards away and pay with cash only.<br /> &nbsp;</li> <li>Pay more than the minimum on your credit cards and tackle the debt.<br /> &nbsp;</li> <li>Ask your credit card company for a lower rate.<br /> &nbsp;</li> <li>Transfer balances to a 0% APR card and work on paying off the principal within a year.</li> </ul> <p><em>Have you ever broken up with your credit cards? How long was the split?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/aaron-crowe">Aaron Crowe</a> of <a href="http://www.wisebread.com/7-signs-its-time-to-break-up-with-your-credit-cards">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/i-dont-love-capital-one-how-to-get-a-lower-apr-or-possibly-not">How to Get a Lower APR, or Possibly Not</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-scary-facts-about-credit-card-debt">6 Scary Facts About Credit Card Debt</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-questions-to-ask-before-accepting-a-credit-card-offer">10 Questions to Ask Before Accepting a Credit Card Offer</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-boost-your-credit-with-a-balance-transfer">How to Boost Your Credit With a Balance Transfer</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-a-credit-card-cash-advance-costs-you-more-than-a-purchase">How a Credit Card Cash Advance Costs You More Than a Purchase</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards APR balance transfers debt high interest rates minimum monthly payments overspending paying cash Fri, 20 May 2016 10:30:08 +0000 Aaron Crowe 1713706 at http://www.wisebread.com 10 Questions to Ask Before Accepting a Credit Card Offer http://www.wisebread.com/10-questions-to-ask-before-accepting-a-credit-card-offer <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-questions-to-ask-before-accepting-a-credit-card-offer" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_shopping_credit_card_000069657419.jpg" alt="Woman asking questions before accepting credit card offer" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Unsolicited credit card offers can flood your mailbox and email inbox, and in most cases, you may not give these offers a second glance. But once you're ready to add a new credit card to your financial portfolio, it's important to understand the basic features of these offers and choose the right card. Credit cards are not one and the same, so it's important to ask yourself these 10 questions before accepting an offer. (See also: <a href="http://www.wisebread.com/pre-approved-for-credit-card-offers-are-you-pre-qualified?ref=seealso">How to Understand Pre-Approved and Pre-Qualified Credit Card Offers</a>)</p> <h2>1. Is This the Right Time to Apply for a Card?</h2> <p>You may not know this, but there are right and wrong times to apply for a credit card. Typically, you don't want to apply for new credit if you're in the process of or thinking about financing a home. Anytime you get a loan, lenders take your current debt load into consideration. If you get a new credit card and amass a large balance fairly quickly, this can increase your debt ratio and reduce purchasing power. There's nothing wrong with getting a new card, just make sure that the decision to accept an offer doesn't interfere with your ability to get financing in the near future.</p> <h2>2. Am I the Right Candidate?</h2> <p>There are credit cards for every type of borrower. Before accepting a credit card offer, read the fine print and know the qualifications for the card, or else you'll waste time applying for cards you're not eligible to receive. Some credit cards are designed specifically for people with excellent credit, whereas other cards are suited for people with low credit scores. (See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-for-people-with-fairaverage-credit?ref=seealso">Best Credit Cards for People with Fair or Average Credit</a>)</p> <p>Credit card companies typically prescreen and match recipients with the appropriate credit card offer. So if you receive an offer in the mail, you're more than likely a suitable candidate. But if you're researching offers on your own, be aware of basic qualifications.</p> <h2>3. What's the APR?</h2> <p>If you'll carry a balance from month to month, make sure you know the card's annual percentage rate (APR). This rate lets you know how much you'll pay in interest if you don't pay off the card in full every month. Interest rates vary and depend on your credit score. Ideally, you want the lowest rate so that you pay the least amount in finance fees.</p> <p>See also: <a href="http://www.wisebread.com/the-best-low-interest-rate-credit-cards?ref=seealso">Best Cards With the Lowest APRs</a></p> <p>Credit card applications feature the APR prominently. A credit card may offer interest rates ranging from 10.99% APR to 21.99% APR, in which case borrowers with the lowest scores pay the highest rates. Some cards also have low introductory rates, such as <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">0% interest on balance transfers</a> and standard purchases for a certain number of months. The interest rate on a credit card can also be fixed or variable. A fixed rate remains the same, but a variable rate can move up or down based on the market.</p> <h2>4. Is There an Annual Fee?</h2> <p>Some credit cards charge an annual fee which can range from $50 to $450. The fee often depends on the number and level of cardmember perks. Make sure you read the fine print for information on annual fees. Not every credit card has an annual fee. If you're looking for a basic, no-frills credit card and you don't care about cardmember perks, it is possible to find <a href="http://www.wisebread.com/the-5-best-credit-cards-with-no-annual-fees">credit cards with no annual fees</a>.</p> <p>See also: <a href="http://www.wisebread.com/how-to-decide-if-an-annual-fee-credit-card-is-worth-it-for-you?ref=seealso">How to Decide if an Annual Fee Card Is Worth It for You</a></p> <h2>5. Is There a Rewards Program?</h2> <p>Many credit cards offer rewards, such as miles, points, or cashback for every dollar you spend. A rewards credit card can work if you use credit cards frequently. But it's important to find a credit card with rewards that fit your lifestyle. If you're a frequent traveler, you can search specifically for <a href="http://www.wisebread.com/5-best-co-branded-airline-credit-cards">airline credit cards</a> or a credit card that lets you <a href="http://www.wisebread.com/top-5-travel-reward-credit-cards">earn miles or points redeemable for travel</a>. The point of the rewards is to get something back for spending (as an incentive for spending, too), so you might as well get something you want or need.</p> <p>See also: <a href="http://www.wisebread.com/cash-back-vs-travel-rewards-pick-the-right-credit-card-for-you?ref=seealso">Cash Back vs. Travel Rewards: Which Credit Card Is Right for You?</a></p> <h2>6. Does the Bank Report to the Bureaus?</h2> <p>Not every credit card company reports to the three major credit bureaus on a regular basis. Whether you want to build or <a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score">improve your credit score</a>, choose a credit card company that will report your activity to the bureaus on a monthly basis. You can find credit bureau reporting information in the terms of agreement on the application, or you can call the bank for this information.</p> <h2>7. Do I Need Another Credit Card?</h2> <p>Getting a credit card offer in the mail doesn't mean you have to complete the offer. Consider whether you need another credit card. Will the new credit card offer you <a href="http://www.wisebread.com/10-awesome-credit-card-perks-you-didnt-know-about">additional perks and benefits</a>, or save you money by <a href="http://www.wisebread.com/5-best-cash-back-credit-cards">offering cash back</a>? Is there a card with an <a href="http://www.wisebread.com/5-best-sign-up-bonuses-for-airline-miles-credit-cards">enticing sign up offer</a>? Then again, if you can't keep up with your current monthly payments, or if your current credit cards are maxed out, adding a new card may further complicate your finances.</p> <p>See also: <a href="http://www.wisebread.com/how-to-save-an-extra-109486-a-year?ref=seealso">How to Save $1,094.86 a Year With Credit Cards</a></p> <h2>8. What Are the Credit Card Fees?</h2> <p>The cost of owning a credit card doesn't stop with the annual fee and APR. Credit cards include a variety of other fees, and it's important to count the cost before accepting an offer. You need to consider the late fee, the cash advance fee, and the balance transfer fee. Additionally, if you used the credit card in a foreign country, would you be charged a foreign transaction fee? Credit card fees add up quickly. You can save money by picking a card with the least amount of fees.</p> <p>See also: <a href="http://www.wisebread.com/5-best-credit-cards-with-no-balance-transfer-fees?ref=seealso">Best Credit Cards With No Balance Transfer Fee</a> and <a href="http://www.wisebread.com/smarter-security-and-no-foreign-transaction-fees-the-best-credit-cards-to-use-while-on-vacation?ref=seealso">Best Credit Cards With No Foreign Transaction Fees</a></p> <h2>9. What Else Can the Card Offer Me?</h2> <p>Besides reward programs, credit cards include a host of other offers and incentives to lure customers. For example, some credit cards give cardholders <a href="http://www.wisebread.com/the-5-best-credit-cards-that-offer-free-credit-scores">free access to their credit scores</a> and the ability to download an app and manage their account from a mobile device. Other cards include <a href="http://www.wisebread.com/what-does-car-rental-insurance-really-cover-on-your-credit-card">car rental insurance</a>, trip cancellation insurance, <a href="http://www.wisebread.com/how-to-take-advantage-of-free-extended-warranty-from-your-credit-card-issuer">extended warranty protection</a>, price protection, and many other perks.</p> <p>See also: <a href="http://www.wisebread.com/the-best-credit-card-perks-beyond-points-and-miles?ref=seealso">The Best Credit Card Perks Beyond Miles and Points</a></p> <h2>10. How Does the Offer Compare to Other Offers?</h2> <p>It isn't enough to review the specifics of a particular credit card offer, you should also determine how this offer compares with other offers. The truth is, you can't truly identify a good credit card offer until you make comparisons. After receiving an offer, the fees and interest rate may seem fair and reasonable. But shopping around may open your eyes to something better. This doesn't mean you have to spend weeks comparing different credit cards, but you should compare at least three cards before making a decision.</p> <p><em>What do you consider before accepting a credit card offer?</em></p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <p style="text-align: center;"><a data-pin-do="buttonPin" data-pin-color="red" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F10-questions-to-ask-before-accepting-a-credit-card-offer&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F10%2520Questions%2520to%2520Ask%2520Before%2520Accepting%2520a%2520Credit%2520Card%2520Offer.jpg&amp;description=10%20Questions%20to%20Ask%20Before%20Accepting%20a%20Credit%20Card%20Offer"><img src="//assets.pinterest.com/images/pidgets/pinit_fg_en_rect_red_28.png" alt="" /></a></p> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/10%20Questions%20to%20Ask%20Before%20Accepting%20a%20Credit%20Card%20Offer.jpg" width="250" height="374" alt="" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/10-questions-to-ask-before-accepting-a-credit-card-offer">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-important-things-you-should-know-about-balance-transfer-cards">7 Important Things You Should Know About Balance Transfer Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-a-balance-transfer-offer-a-good-deal">Is a Balance Transfer Offer a Good Deal?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/should-you-buy-a-car-with-a-credit-card">Should You Buy a Car With a Credit Card?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-credit-card-transactions-that-dont-earn-rewards">4 Credit Card Transactions That Don&#039;t Earn Rewards</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-steps-to-picking-the-best-airline-credit-card-for-the-most-rewards-value">5 Steps to Picking the Best Airline Credit Card for the Most Rewards Value</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards applying for credit APR balance transfers cashback fees rewards Wed, 20 Apr 2016 10:30:10 +0000 Mikey Rox 1690617 at http://www.wisebread.com 7 Important Things You Should Know About Balance Transfer Cards http://www.wisebread.com/7-important-things-you-should-know-about-balance-transfer-cards <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-important-things-you-should-know-about-balance-transfer-cards" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_credit_card_tablet_000089260129_0.jpg" alt="Woman considering things before transferring credit card balance" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Zero-interest credit cards can provide a valuable solution for anyone who is attempting to pay off a card with a high interest rate. They can help you <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?ref=internal">pay off debt faster</a> and <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=internal">save money on interest</a>, help consolidate your monthly card payments, or increase your available credit, thereby improving your credit score. (See also: <a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score?ref=seealso">How to Raise Your Credit Score with Credit Cards</a>)</p> <p>However, there are also a number of reasons you may want to avoid the temptation to transfer your current balance to a 0% APR credit card. Consider these potential pitfalls before signing up.</p> <h2>1. Balance Transfer Fees</h2> <p>Usually when you execute a balance transfer, you will be subject to a transfer fee, which can be between 3%&ndash;5% of the total amount transferred. This can be a hefty amount added to your total balance due. But, in comparison to a high interest rate card, you might still end up saving money. You'll have to calculate your monthly interest, how much you would save with an interest free credit card, and whether that is more than the balance transfer fee.&nbsp;</p> <p>There are some cards, that <a href="http://www.wisebread.com/5-best-credit-cards-with-no-balance-transfer-fees?ref=internal">don't have a balance transfer fee</a>. However, some of these may not offer the 0% promotion period where you don't pay interest at all, or have a shorter period than another card that requires a balance transfer fee. Again, you'll need to do the math to decide what is best for you.</p> <h2>2. It Might Hurt Your Credit Score</h2> <p>Applying for any credit card will result in a hard inquiry on your credit report whether you are approved for it or not, which can result in your credit score taking a hit. This means that even if you aren't approved for the new credit card, your credit score could decline.</p> <p>If you close the original credit card after making the balance transfer, the average age of your accounts will drop. It will also cause your total available credit to decrease. These factors will negatively affect your credit score. To combat these problems, simply keep the original credit card open (with a $0 balance), even after transferring the balance out of it. However, if you will be tempted to spend money on the old credit card, then it is best to just close it.</p> <h2>3. It's Only Temporary</h2> <p>Zero-interest offers are temporary and usually last between 6 to 21 months. You shouldn't get comfortable with this low APR because it will revert to a higher APR once the intro period is up. When making a balance transfer, it is most important to commit to paying off the balance within the intro period. Otherwise, the interest will start accruing again and it would be a waste of an opportunity to get rid of your debt completely.</p> <h2>4. You Might Not Qualify for 0%</h2> <p>Keep in mind that you don't have a 0% promotional interest rate until you are approved for it. Receiving an application or <a href="http://www.wisebread.com/pre-approved-for-credit-card-offers-are-you-pre-qualified?ref=internal">pre-approval in the mail</a> does not guarantee that you will get it. Also, a 0% balance transfer credit card can't help you if you get approved, but the credit limit on it is so low that it can't cover the amount you want. You'll just end up having two payments every month instead of one.</p> <p>Always be sure to read carefully what you are applying for. Balance transfers aren't always included in promotional APR offers, so read the offer to see if the 0% applies to <em>purchases</em> and/or <em>balance transfers</em>. Sometimes they only offer 0% for one, not the other.</p> <h2>5. You May Not Be Able to Transfer the Balance at All</h2> <p>Most issuers won't allow a balance transfer from another one of their cards. You'll need to get a card that isn't issued by the same bank as the card you want to transfer the balance from. Check that the card issuer of the credit card you have a balance on isn't the same as the one you want to apply for.</p> <h2>6. You May Be Tempted to Only Pay the Minimum</h2> <p>Many borrowers who open a new zero-interest credit card will be tempted to only pay the minimum amount due, rather than what they were paying on their original credit card. Just because you have a lower intro APR doesn't mean you should be paying any less than you were before. In fact, now is the time to pay off the credit card, when you don't need to worry about interest, so make sure to pay at least as much as you were paying on the original credit card.</p> <h2>7. You May Be Tempted to Spend More</h2> <p>If you have a hard time keeping credit cards open without spending, you may not want to open another card. Adding more debt defeats the whole purpose of opening a card for a balance transfer, and will put you in an even worse position than when you started. And sometimes the 0% doesn't apply to new purchases, which means you'd immediately start accruing interest on any new purchase you make. So the best thing you should do when opening a card for a balance transfer is to not add any new purchases on that card.</p> <h2>How to Make the Most of the Card</h2> <p>If you decide to pursue a balance transfer offer, make sure you are fully aware of the terms beforehand. You'll want to know when the 0% APR is up, what the regular APR will be after the intro rate expires, the minimum monthly payment, and how much the balance transfer fee is. To make the most of the offer, pay off your balance before the 0% intro APR offer ends. Otherwise, you will end up wasting more on the balance transfer fee and the new credit card APR.</p> <p>The key is to use this card strategically to decrease your debt. If you don't use it for any other purchases and keep your eye on the intro APR expiration date, you should be fine.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/7-important-things-you-should-know-about-balance-transfer-cards">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/is-a-balance-transfer-offer-a-good-deal">Is a Balance Transfer Offer a Good Deal?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-boost-your-credit-with-a-balance-transfer">How to Boost Your Credit With a Balance Transfer</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-questions-to-ask-before-accepting-a-credit-card-offer">10 Questions to Ask Before Accepting a Credit Card Offer</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps">How to Rebuild Your Credit in 8 Simple Steps</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-habits-of-highly-responsible-credit-card-users">12 Habits of Highly Responsible Credit Card Users</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards Debt Management APR balance transfers credit score fees zero interest Tue, 19 Apr 2016 09:00:11 +0000 Andrea Cannon 1691579 at http://www.wisebread.com Best Credit Cards with 0% APR for Purchases http://www.wisebread.com/5-best-credit-cards-with-0-apr-for-purchases <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-best-credit-cards-with-0-apr-for-purchases" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/happy-shopper-iStock_000072291563.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you've got a big purchase planned (or a bunch of small ones), and you don't think you can pay it off within the month to avoid interest charges, you might consider a credit card that offers a promotional 0% APR on purchases. This will give you some time to pay off your new purchases without the stress of interest charges building up. Here are the best credit cards that currently offer 0% intro APR on new purchases.</p> <h2>Bank of America&reg; Cash Rewards Credit Card</h2> <p><img style="float:right;margin:0 5px 5px 10px;" class="img-exempt" alt="" src="http://www.yceml.net/0835/12994371-1501687529206" border="0" height="97" width="154" /><a style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;" target="_blank" alt="BankAmericard Cash Rewards&trade; Credit Card" title="BankAmericard Cash Rewards&trade; Credit Card" rel="nofollow" href=" http://ct.wisebread.com/click.php?pg=160&amp;pid=106&amp;pp=1&amp;uv=xcardbutton"><img alt="" class="img-exempt img-button" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a>The <a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=106&amp;pp=1&amp;uv=xname">Bank of America&reg; Cash Rewards Credit Card</a> offers 0% Introductory APR for 12 billing cycles for purchases, then, 13.99% - 23.99% Variable APR. You also get 3% cash back on gas and 2% cash back at grocery stores and wholesale clubs, up to $2,500 in combined purchases each quarter, and 1% cash back on other purchases. Bank of America customers can earn a 10% bonus when redeeming cash back into a Bank of America&reg; checking or savings account. New cardholders also earn a $150 bonus after spending $500 on the card in the first 90 days of account opening. <strong>There is no annual fee for this card.</strong></p> <p><a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=106&amp;pp=1&amp;uv=xend"><strong>Click here to learn more and apply for the&nbsp;Bank of America&reg; Cash Rewards Credit Card today!</strong></a></p> <!--<p><h2>Chase Slate&reg;</h2> <p><img style="float:right;margin:0 5px 5px 10px;" class="img-exempt" alt="" src="http://www.imgsynergy.com/191x120/chase-slate-060216.png" width="154" border="0" height="97" /><a style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;" target="_blank" alt="Chase Slate&reg;" title="Chase Slate&reg;" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=39&amp;pp=2&amp;uv=xcardbutton"><img alt="" class="img-exempt img-button" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a>The <a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=39&amp;pp=2&amp;uv=xname">Chase Slate&reg;</a>&nbsp;offers a 0% intro APR for 15 months on purchases and balance transfers, along with no intro balance transfer fee for balance transfers made within the first 60 days of opening the account. After the introductory period, a standard rate of 15.74%-24.49% variable APR applies. Thankfully, paying late won&rsquo;t affect your interest rate as this card has no penalty APR. You can access your monthly FICO score for free and receive tips on managing your credit health. Finally, you can utilize Chase's innovative Blueprint program which allows you to save money on interest charges by paying some purchases in full while carrying a balance on others. <strong>This card has no annual fee.</strong></p> <p><a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=39&amp;pp=2&amp;uv=xend"><strong>Click here to learn more and apply for the Chase Slate&reg; Credit Card today!</strong></a></p>--><!--<p><h2>Chase Slate&reg;</h2> <p><img style="float:right;margin:0 5px 5px 10px;" class="img-exempt" alt="" src="http://www.imgsynergy.com/191x120/chase-slate-060216.png" width="154" border="0" height="97" /><a style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;" target="_blank" alt="Chase Slate&reg;" title="Chase Slate&reg;" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=39&amp;pp=2&amp;uv=xcardbutton"><img alt="" class="img-exempt img-button" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a>The <a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=39&amp;pp=2&amp;uv=xname">Chase Slate&reg;</a>&nbsp;offers a 0% intro APR for 15 months on purchases and balance transfers, along with no intro balance transfer fee for balance transfers made within the first 60 days of opening the account. After the introductory period, a standard rate of 15.74%-24.49% variable APR applies. Thankfully, paying late won&rsquo;t affect your interest rate as this card has no penalty APR. You can access your monthly FICO score for free and receive tips on managing your credit health. Finally, you can utilize Chase's innovative Blueprint program which allows you to save money on interest charges by paying some purchases in full while carrying a balance on others. <strong>This card has no annual fee.</strong></p> <p><a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=39&amp;pp=2&amp;uv=xend"><strong>Click here to learn more and apply for the Chase Slate&reg; Credit Card today!</strong></a></p>--><h2>Chase Freedom&nbsp;Unlimited<sup>&reg;</sup>&nbsp;</h2> <p><img src="http://www.imgsynergy.com/191x120/chase-freedom-unlimited-072116.png" alt="" class="img-exempt" style="float:right;margin:0 5px 5px 10px;" border="0" height="97" width="154" /><a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=130&amp;pp=3&amp;uv=xcardbutton" target=" rel=" style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" class="img-exempt img-button" alt="" /></a>The <a target="_blank" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=130&amp;pp=3&amp;uv=xname">Chase Freedom&nbsp;Unlimited<sup>&reg;</sup></a> has a 0% introductory APR on purchases and balance transfers for 15 months, after which a variable APR of 15.99%-24.74% will apply. The balance transfer fee is either $5 or 5% of the amount of each transfer, whichever is greater. This card awards unlimited 1.5% cash back on every purchase, automatically. Redeem your cash back at any time without any minimum requirements, and your rewards do not expire. Plus, you earn a $150 bonus after you spend $500 on purchases in your first 3 months from account opening. <strong>There is no annual fee.&nbsp;</strong></p> <p><a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=130&amp;pp=3&amp;uv=xend"><strong>Click here to learn more and apply for the Chase Freedom Unlimited<sup>&reg;</sup> today!</strong></a></p> <!--<h3>Barclaycard Ring&trade; Mastercard&reg;</h3> <p><img style="float:right;margin:0 5px 5px 10px;" class="img-exempt" src="http://www.imgsynergy.com/191x120/barclaycard-ring-mastercard-081215.png" alt="" border="0" height="97" width="154" /><a style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;" target="_blank" rel="nofollow" alt="Barclaycard Ring&trade; Mastercard&reg;" title="Barclaycard Ring&trade; Mastercard&reg;" href="http://ct.wisebread.com/click.php?pg=q60&amp;pid=23&amp;pp=4&amp;uv=xcardbutton"><img alt="" class="img-exempt img-button" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a>The <a target="_blank" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=23&amp;pp=4&amp;uv=xname">Barclaycard Ring&trade; Mastercard&reg;</a> offers 0% intro APR on purchases and qualifying balance transfers for 15 months, with no balance transfer fee. After the intro period, a variable APR of 13.99% will apply. The card's Giveback&trade; Feature enables you to receive a small percentage of the company profits, which you can donate to charity or keep in your account as a bonus credit. <strong>There is no annual fee.</strong></p> <p><strong><a target="_blank" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=23&amp;pp=4&amp;uv=xend">Click here to learn more and apply for the Barclaycard Ring&trade; Mastercard&reg; today!</a></strong></p>--><!--<h3>Barclaycard Ring&trade; Mastercard&reg;</h3> <p><img style="float:right;margin:0 5px 5px 10px;" class="img-exempt" src="http://www.imgsynergy.com/191x120/barclaycard-ring-mastercard-081215.png" alt="" border="0" height="97" width="154" /><a style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;" target="_blank" rel="nofollow" alt="Barclaycard Ring&trade; Mastercard&reg;" title="Barclaycard Ring&trade; Mastercard&reg;" href="http://ct.wisebread.com/click.php?pg=q60&amp;pid=23&amp;pp=4&amp;uv=xcardbutton"><img alt="" class="img-exempt img-button" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a>The <a target="_blank" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=23&amp;pp=4&amp;uv=xname">Barclaycard Ring&trade; Mastercard&reg;</a> offers 0% intro APR on purchases and qualifying balance transfers for 15 months, with no balance transfer fee. After the intro period, a variable APR of 13.99% will apply. The card's Giveback&trade; Feature enables you to receive a small percentage of the company profits, which you can donate to charity or keep in your account as a bonus credit. <strong>There is no annual fee.</strong></p> <p><strong><a target="_blank" rel="nofollow" href="http://ct.wisebread.com/click.php?pg=160&amp;pid=23&amp;pp=4&amp;uv=xend">Click here to learn more and apply for the Barclaycard Ring&trade; Mastercard&reg; today!</a></strong></p>--><h3>Citi Simplicity&reg; Card - No Late Fees Ever</h3> <p><img style="float:right;margin:0 5px 5px 10px;" class="img-exempt" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5169/CitiSimplicityCard.jpg" alt="" border="0" height="97" width="154" /><a style="border:none;float:right;clear:right;margin: 0 5px 5px 10px;" target=" rel=" href=" http://ct.wisebread.com/click.php?pg=160&amp;pid=54&amp;pp=6&amp;uv=xcardbutton"><img alt="" class="img-exempt img-button" src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/apply-now.png" /></a>The <a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=54&amp;pp=6&amp;uv=xname" target="_blank" rel="nofollow">Citi Simplicity&reg; Card - No Late Fees Ever</a>&nbsp;from our partner Citi, offers 0% intro APR on purchases and balances for an impressive 21 months! After the intro period, the variable APR will be 14.99%-24.99%. While there is a balance transfer fee of $5 or 3% of the amount of each transfer (whichever is greater), this card has no late fees, no penalty APR, and <strong>no annual fee</strong>. Simple, right?</p> <p><strong><a href="http://ct.wisebread.com/click.php?pg=160&amp;pid=54&amp;pp=6&amp;uv=xend" target="_blank" rel="nofollow">Click here to learn more and apply for the Citi Simplicity&reg; Card - No Late Fees Ever today!</a></strong></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jason-steele">Jason Steele</a> of <a href="http://www.wisebread.com/5-best-credit-cards-with-0-apr-for-purchases">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/top-5-travel-reward-credit-cards">The Best Travel Reward Credit Cards</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-secured-credit-cards">The Best Secured Credit Cards</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-cash-back-credit-cards">The Best Cash Back Credit Cards</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-5-credit-cards-for-groceries">The Best Credit Cards for Groceries</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards APR best credit cards Mon, 18 Apr 2016 10:30:05 +0000 Jason Steele 1667669 at http://www.wisebread.com