Credit card interest can pile up quite quickly. If you have a card or two that you’re not carefully monitoring, you can end up in serious financial trouble. If you get a credit card with a 0% APR offer for a term of time, monitoring that expiration will also reduce your risk of paying high interest on a balance transfer.
Track Your Spending, Track Your Interest
Staying on top of your credit card debt means that you need to manage your spending. Many people have better luck tracking their spending and interest on either a budgeting app or a credit card app.
If your credit card debt is already stacking up, it’s a good idea to create a spreadsheet that allows you to monitor your
- total owed
- minimum payment
- interest rate
If you note that your credit rating is dropping and you have no way to meet your minimum payments, moving quickly to address the shortfall is critical.
If your credit has been damaged by an inability to pay or by too much debt in relation to your income, interest rates can creep up unannounced on some credit cards. Do take the time to review each statement to make sure that each charge attributed to you is accurate and that your interest rates are not creeping up. According to the experts at Lantern by SoFi, “Cash advance APRs are usually very high, and cash advance transactions can come with additional fees, Interest starts accruing interest immediately on cash advances.”
Should you be interested in reducing your interest, it may be a good idea to apply for a 0% APR card that you can use to transfer high-interest rate debt. If you can get a 0% APR card, you will need to track the debt on your calendar to make sure that you either pay it off or refinance it before the deadline hits.
Get a Business Credit Card
If you’re starting a small business or are building a side hustle and you need supplies or tools, you may want to apply for a business credit card. Take care to only purchase items that support your business goals.
Don’t use a business credit card to protect your personal credit rating. If you can’t afford personal items, don’t buy them. Carefully track your business expenses and note your spending on any side hustle tools or equipment and keep your receipts for your tax return.
Do Your Research
If your credit rating has been damaged by recent world events, you may have been paying higher than average credit card interest. According to Lantern by SoFi, doing the work to improve your credit score should allow you to pay lower than average credit card interest.
As your credit rating improves, it’s a good idea to look for better loan terms. This can include 0% APR credit cards that allow you to do a rollover. If you can’t qualify for those immediately, pay off the smallest card balance as quickly as possible and call the lender to see if you can get a rollover offer. If you’re not good at managing your credit cards, consider getting credit counseling so you can improve your credit rating over time.