Tips for Saving Money on Credit Cards for Single Parents
Credit cards can be a very convenient way to pay for items and services. And, single parents crave convenience due to their limited available time. But, are you paying more than you should in interest and fees? Credit card companies have many tactics to part you with your money.
First, make sure to pay your bills on time. A good credit history will result in a lower interest rate if you carry a balance. And, you will avoid exorbitant late fees if you pay your bill by the due date. Make sure that you check this due date each month because it may not always fall on the same day.
Check your credit report and correct any inaccuracies. Credit card companies base interest rates on your credit history, so you want your credit report to be as clean as possible.
When you are applying for a new credit card, compare interest rates. You want to get the card with the lowest one, but be sure to check whether the rate is fixed or adjustable, meaning that the rate can go up.
Don't pay annual fees for credit cards unless the perks associated to the card are worth more than the fee. There are many good cards available that don't charge annual fees, so it's worth shopping around for credit cards.
When you are paying off your credit cards, start with the one that has the highest interest rate since this will save you the most money. The only exception might be if you have a very small bill on a lower interest rate card. As a cash-strapped single parent you may want to pay that bill off just for the psychological lift of having one less bill.
Some credit cards offer rebates and other incentives to use the card. Before signing up, make sure that the incentive is something that you will truly use. And, consider whether the interest rate charged and/or annual fee may make the incentive ultimately worthless.
Credit card companies often send out convenience checks to their customers. Read the fine print, because there may be a substantial fee involved with using the checks even if there is an enticing 0% interest offer.
You may be able to save money on interest by transferring balances on high interest cards to lower interest cards. Understand the terms involved, since you may get hit with fees by doing this. Also, bear in mind that any new purchases made with the card used for the balance transfer will be charged interest. And, payments that you make will be applied to the new purchases before the balance transfer amount.
Credit cards can be a useful financial tool for single parents if used correctly. You can potentially save money by using the methods above and paying attention to the fine print. But, it's best to always pay off the balances on your credit cards each month so that you don't run up huge balances and interest fees.
