With credit card balances on the rise, it looks like consumers are depending upon debt more than ever. As a result, consumers are making that minimum payment while ignoring the credit card statement. After all, with interest rates going up, you might find out some bad news about your own interest rates.
According to Lendingtree, nearly 1 in 5 Americans are afraid to check their credit card statements. According to creditcards.com , the average interest rate is 17.46% as of July 20 and is projected to be 19% by the end of the year. Yes, 19% the number that is close to 20% - YIKES!!
The necessity of covering everyday expenses on your credit card is one thing. After all, desperate times require desperate measures. According to the upgraded Points Report, consumers have been going to credit cards to pay for vacations, computers, furniture, automotive expenses, etc.
What are some "take-aways" about credit card use?
Rising Interest rates
Every time the Federal Reserve Board raises interest rates, more than likely, credit card interest rates will go up as well. You signed a document when opening the credit card stating that you were okay with higher rates. Rates can go up higher than you can imagine - then you have a real problem.
Credit card companies have been known to cheat
I know for a fact that some credit card companies have been known to move payment days from that regular payment date you pay by each month to one day earlier. That little "adjustment" might just throw you off if you are not paying attention. As a result, you could be paying higher interest rates going forward and fees for being late.
Watch out for "Good Deals"
Credit card companies are hungry for your debt. They want you to roll over that high-interest debt and will give you an "interest-free" period. What they don't tell you is that the transfer fee is a credit card cost, just like an interest rate. Nothing is for free - I saw one for Discover the other day that had a 6% transfer fee for an interest-free period of only 9 months then, their interest rate would be over 14%. That first year's costs were equivalent to over 8% in interest rate costs during that first year!
With inflation costs rising, a pending recession, rising interest rates, and stock market troubles, it is time to step away from the cards and put together a game plan to get of that credit card debt once and for all!