Archive for the ‘Credit Cards’ Category

I promised last week I would report back on my results to get my credit card APR’s lowered. However, I was tied up most of the weekend and not really free to make long calls — which I didn’t know they would be until I tried one. After speaking to a customer service rep at Capital One who then promised to transfer me to an “account manager”, I was on hold for 10 minutes and hung up because I had to get off the phone.

But I’m nothing if not persistent and will get these calls done this week.

However, I did accomplish a few things:

  • I filed or shredded about a year’s worth of statements, records, bills and reciepts for larger items. I can see my desktop!
  • I found my copy of Microsoft Money 2006 (for small business and personal finances) buried under the piles and installed it
  • I talked to family members about my new “cash-only” life — to let them know that I won’t be going out to eat as much, I won’t be spending as much, and I’ll be working more on my side business on the weekend than before
  • I also calculated the last 9 months of utility bills to start seeing what I pay in energy costs throughout the year — part of getting ready to budget
  • Spent very little going out on St. Patrick’s Day! About $10 on drinks. Flasks are a wonderful, wonderful thing!
  • Cut some coupons and had a very “smart” trip to the grocery store last night — preplanned several crockpot meals that should get me through until next pay period

Goals for this week:

  • Complete calls to credit card companies
  • Download statements and begin to work with Microsoft Money — time to see where the money has been going before I start thinking about budgeting
  • Finish taxes

Here’s to a great week!

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It embarasses me to admit that 5 of my 7 credit accounts that I am working to reduce have APR’s of over 20%. It really didn’t hit me until I made a spreadsheet this week of the current totals.

Head in the sand   

I’ve had my head in the sand long enough.

Bankrate.com has some great advice about calling up the credit card companies and simply asking to have your APR lowered.

…the results of a national survey conducted by the U.S. Public Interest Research Group in March 2002. Fifty consumers of all credit backgrounds called credit card issuers and asked for lower rates. More than half, 56 percent, scored lower rates.

They also provided the script that those callers used.

Hi, my name is [Your Name]. I am a good customer, but I have received several offers in the mail from other credit card companies with lower APRs. I want a lower rate on my card, or I will cancel my card and switch companies.

I’ve got a busy day at work today, but I’m going to find time over the weekend to make these calls. Look for the results of my own attempts on Monday!

Wow.

Calculations are in.

I’m just going to post the numbers and hit the sack. It is what it is.

Credit card debt: $18,375* (this number is current for March 1, before payments I’m making this month)

Savings: $46 (this number is current as of today)

I’ll post a bit tomorrow about how I got into this much (pretty typical, most likely), about some of the things I’ve done to reduce my expenses in the last two months, and set some goals.

*note: this does not include my student loans, credit union car loan, small credit union personal loan, or mortgage — all which have halfway decent interest rates. So I don’t curl up in the fetal position and sob — I’m only focusing on the credit card debt, now, while continuing to budget and pay down these debts as well.

As I compile a list of my credit cards and accounts, I am happy to note that one card from Household Bank has a balance of zero. Conventional wisdom tells us to cut up the card, don’t take replacements, but keep the account open to keep your credit score high. However, I’ve decided to take the advice here at 360 Degrees of Financial Literacy and called this morning to close that account. This is a psychological decision to remove temptation and begin to whittle the number of open accounts down.

And yeah, it felt good!

Here is the advice from 360:

  • If credit is easily available, you may be tempted to use it. Any impulsive purchases could quickly mount up and result in serious debt problems. (Me: heh, yeah, that’s already what has happened. Out, out damn temptation!)
  • Open accounts may be used fraudulently if your account numbers are stolen or your cards are lost.
  • You may have to pay annual fees for the cards even if you don’t use them.  (Apparently I had paid an annual fee last October. This is one of the things the account manager, desperately trying to keep me as a customer, pointed out.)
  • Whether used or not, open accounts may create trouble when you apply for other credit such as mortgages or loans. Lenders commonly review your credit history and may see you as a credit risk if you have multiple open accounts with a large amount of available credit. Potentially, you could still use them and build up unacceptable levels of debt.  (Not really an issue — I’m halfway through a current car loan from my credit union and I bought my house a year ago.)

The account manager to whom I was transferred offered me upgrades to my card, which I assume would include lower interest rates, a premium account, appealed to my length as a customer (this account was opened in 1999) and did her best to convince me to stay. I simpled repeated, in a friendly tone, “no thanks, I would just like to close the account” and it was accomplished in about 2 minutes.

Another piece of advice — get a confirmation letter. I asked for one and it should be on its way.