How To Pay Off Credit Cards
Credit cards enable you to pay for items when you do not have the cash for the purchase. And when repaying or paying off your credit card debt, you pay off the amount of money borrowed plus a fee.
To learn how to pay off credit cards properly and save money, it is important to know what a credit card company will charge you for using their card. Three items to consider are:
Annual Fees - This is a yearly charge for using the credit card. Some companies offer credit cards with no annual fees as long as it is always used.
Finance Charges - This is the cost of using the credit. The credit card company may charge you for the cash advance and for your outstanding balances. Some charge as high as 18% a year, which is 1.5% a month.
Grace Period - This is the time between when you are billed and the time you have to pay the debt. But note that some low interest rate cards charge interest on all purchases from the date they were made.
Credit Card Pay Off Tips
First, find out what type of credit card you have, and know the annual fees, finance charges and grace period. To save money, pay off outstanding balances within the grace period.
Second, if you have a secured credit card, your credit is secured by your savings account. If you fail to pay off your outstanding balances, your bank may deduct what you owe from your savings account.
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