Discover Debt Freedom!

Many people have begun to protest many of the practices of the credit card company that tend to cost them more money than they believe they should be paying.  The anger from the general public has become so vocal about these credit card practices that Congress has recently passed the Credit Cardholder’s Bill Of Rights cracking down on the worst practices and the President is expected to sign this legislation into law quickly.  But there are a number of things that people can do on their own to save money on their credit cards and adopting these methods has the potential to save a person hundreds of dollars in credit card costs each year.

Pay Off Your Credit Card Monthly

One of the easiest ways to save money on your credit cards is to never charge more to then than you can pay off each month.  Carrying a balance on the credit card will result in finance charges and interest fees that can add a significant amount to the amount that will need to be paid off.  These charges cannot be levied before a certain period of time has passed, so paying off the credit card in full before these charges are levied results in an interest free loan for the month.

Pay Your Bill Immediately

In order to avoid problems and significant charges to your credit card account, it is best to make a payment on your credit card as soon as possible after you have received your bill to make sure that your payment will not be received late.  Making a payment on your credit card late gives the credit card company numerous opportunities to make money off of you.  Many credit card companies use the fact that you have missed a payment due date to skyrocket the interest rate for the card to the highest allowable limit, which could be as much as 30% for some cards.

Another charge that will be levied is a late payment charge, which could be as high as $39 per occurrence, even if the payment is only a few hours late.  If the person is close to their credit limit and this late payment charge pushes them over their credit limit, the credit card company will use this as a reason to charge the account an over-limit fee, which could add another $39 charge to the balance of the account.  A single missed or late payment could cost the person $80 or more in fees and interest rate hikes.

Limit Use Of The Credit Card

Although the temptation to place purchases on your credit card can be very high, going this route will cost the person a large amount of money.  In addition to the interest charges and finance charges, there is a good chance that the person will spend more than they can afford to repay, will go over their credit limit triggering additional charges, or will carry a balance on the card which allows the company to charge high fees for using the credit card.  The best way to use a credit card is to only use the credit card for emergency purchases and to pay cash for everything else.