Hidden Credit Card Charges
Hidden credit card charges can do a lot to make what you thought was a good credit card offer, really not that great. Follow these money saving tips from www.BetterMoneyAdvice.co.uk.
Hidden credit card charges can sting our wallets at the very worst time each month and often, people don’t understand why it happens. To learn more about unexpected credit card charges and how to prevent them read on.
Breaking credit card agreements can often result in hefty charges, causing significant damage to your finances. To help prevent unnecessary costs we have detailed the most common card policies which can lead to nasty fines.
Agreed Credit Limits
Depending on the type of credit card you hold, spending over the agreed credit limit will result in a penalty, fine or increase on the amount of interest you will have to pay back to your credit card holder.
Hidden credit card charges: Interest Free Days and Minimum Payments
Most credit card issuers offer a payment period that is interest free. Paying your balance off within this time frame cuts any extra costs to your credit card bill.
Those who opt for paying the minimum payment each month may find they are only just covering the cost of interest. For example, if you are paying an interest of 2 percent then minimum payments may not even cover interest costs let alone the outstanding balance you owe your card provider. To cut hidden costs, it is advised to pay off your credit card balance in one lump sum as soon as possible.
Credit Cards Abroad
Credit card users will be charged for withdrawing cash or making payments when abroad. In a study by the Post Office, reports showed the majority of credit cards charge a typical 2.75 percent.
“49 percent of UK holidaymakers planning to use their credit card when shopping abroad could be returning with a lot more than just ‘memories and mementoes’ due to hidden card charges,” explains Post Office director of lending Gary Fitton.
Balance Transfer Fees
According to a report released at the end of 2007 credit card companies increased balance transfer fees to stem the flow of card switching and to recoup losses from the recent capping of default charges.
Prevention
The Citizens Advice bureaux, a network of independent charities that helps people resolve their money problems, urges card users to read their credit card contracts very carefully. Making sure you read the small print can save you money and time.
In a recent study, the bureaux constructed a list of helpful tips to prevent unforeseen charges. Read on to find out their tips.
Understanding Hidden Credit Card Charges
Better Money Advice Tip: Read the small print on Credit Cards
Neglecting the finer details of your credit card contract can lead you into great trouble. Check for any extra cost in your credit agreement and work out the types of transactions which could lead to a penalty fee at the end of the month- then take measures to avoid such situations.
Get your priorities right:
Paying everyday bills must be a priority – splashing out on your credit card can lead you into dangerous territory if you cannot make credit card payments. Paying the bare minimum off your credit card balance each month will only increase the overall cost and length of time you will be paying money back to your credit card provider.
According to the Citizen Advice Bureau the key to keeping hidden fees at bay is to budget and be realist with your money. In addition if can pay for goods with cash. Cheque or debit card then do so. Read more: Interest Free Overdrafts Beat Credit Card Debt.
Don’t bank on an overdraft:
The Citizens Advice Bureau claims that too many of us take advantage of our overdraft facilities. Instead, it is advised to consult with your bank before indulging in the overdraft - especially if you intend to spend more than your agreed limit or have not set up an overdraft in the first place - otherwise you will be charged.
shop Around for a Credit Card:
Before signing up to a credit card - do your research and compare terms and conditions. Interest rates vary between cards while others other interest free periods. Budget all the costs before making any contract final.
shopping around for a new credit card deal? While there are competitive deals available most lenders rely on consumer apathy and confusion to take your money. Beat the credit card con with our essential advice.
Find more money saving tips and advice online at: www.bettermoneyadvice.co.uk
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