How to Save Money on Credit Cards

Most people never consider a credit card as being something you can save money on. If you carry credit card debt, there are some tactics you can use to same money on your credit cards.

Leave Home without It

If you’re like most people, you spend more money if you carry a credit card around. Some studies show that credit card holders spend 23 percent more on average even if they don’t carry a balance on the credit cards. No investment pays an instantaneous 23 percent rate after taxes. Even business investments. Despite what one credit card issuer says, you’re really better off if you leave home without it.

Ask Your Bank to Waive Its Annual Fee

Call your bank and explain that, because of the annual fee, you might cancel your credit card. Tell the bank you think it should waive its annual fee. Your current credit card issuer will probably gulp and then waive the fee. For a two-minute telephone call, you could now be ahead by $50 or more for the year. Be aware, however, that typically this will not work on “premium” cards such as platinum or gold cards.

Consider an Affinity Card

If you travel on business a lot, you can easily run up $10,000 or more on a credit card as you pay for airline tickets, hotels, and rental cars. In this case, it’s well worth it to apply for an affinity card. Once you have the card, charge all your personal and business purchases on it and put those rewards to work for you.

Cancel Credit Insurance If You Have Any

Credit life insurance is usually a big waste of money. You only need credit life insurance if you know your estate will collect and you can’t get a better kind of insurance.

Credit disability insurance is usually another big waste of money. But, as with credit life insurance, you may need this insurance if you require disability insurance and you can’t get better insurance.

Cancel Credit Card Protection Insurance If You Have It

Another way to save money is to cancel credit card protection insurance. If some nefarious type steals your credit card and runs up huge charges, you are probably only liable for the first $50 or so as long as you immediately tell the credit card issuer that the credit card was stolen.

Never Make the Minimum Payment

Pay more than the minimum payment. Paying off high-interest-rate credit cards is one of the best investments you can make. (The others are typically investing in a profitable business and contributing money to a 401(k) plan in which the employer matches a portion of the contribution.) If you make minimum payments only, your credit card debt quickly balloons. Soon you are paying massive monthly finance charges.

Get Rid of Your Gold Card

You’re paying for the privilege and prestige of that gold, platinum, or any other card marketing as being “exclusive”. You can probably save yourself at least $50 just by having an old, boring, regular Visa or MasterCard. Don’t be tricked in to thinking these cards are somehow better or that people will be more impressed by you if you have one.