One of my favorite personal finance topics is the Credit Card, the deal you get with your credit companies and what to pay attention to with your credit card to make sure using one doesn’t hurt you financially in the long run. With Christmas just on the horizon our credit card usage will be at all high as we rush to make sure the festive season a good one but have you considered all the angles you need to with your credit card? Are you being a smart credit card user?
Way back in August I talked about paying attention to the signs that your credit card dance is due which (in case you didn’t read that article) really gave some ideas on when its time for you to contact your credit company and ask for that better deal lest the interest rate start to hurt you financially. And even earlier in the year I gave some simple and easy strategies on How to do Credit Card Negotiation and how to find and ask for best deal. My personal experience is so many of us get caught up with life we often forget to ask or negotiate and so that was my attempt to nudge you into taking the three minutes it can often take to ask the question.
Do you know everything about your credit card?
Another aspect to making sure your using your credit card responsibly is to consider the warranty and legal aspect to your credit card usage. Many of us are unaware that many credit cards offer additional warranty, extended warranty or even consumer card protection when you spend using their cards. And lets face it one of our biggest worries with buying gifts and presents can be will the present work as intended or designed when it arrives with your family member or friend? Imagine the look on their faces when the box is opened and the item is broken.
The United Kingdom for example has a little known law called Section75 which is designed to protect consumers. The united states has the Credit Card act which was created in 2009 and has a similar level of protection for consumers. I found a brilliant description over at TotallyMoney.com for you UK Christmas shoppers so you can better understand what to look for in your cards, whats on offer and what it all means for you. If your short on time the basics are;
- Credit cards have a level of protection you wont receive if your using cash or a debit card.
- Credit card companies and retailers both have responsibility to help you if their is a problem.
- Section 75 includes a quite powerful right to refund for you the consumer.
- Can even include consequential costs occurred as a result of a problem with an item purchased and covered using your credit card.
All these little bits of information are the things that can make your decision to use a credit card this Christmas a smart one. Without knowledge like this (and my prodding you into asking for interest rate reductions) your Christmas Credit card spend can often end up taking three to six months of pain and sacrifice to pay off and reduce.
I myself personally called my credit card company this week armed with my credit card negotiation skills to ask for them to do something for Christmas. The conversation went like this;
Me – “Hi I am just wondering what you can offer me on my outstanding balance and new transactions on my card with you?”
Them – “I am sorry sir but we have offered you several discounts before and our policy is we can only do this one”
Me – “Sure I understand. I will just go an organize a balance transfer similar to the one you mailed me out last week. Thank you for your time.”
Them – “Oh please dont be hasty Mr Goodman I am sure if I talk to my supervisor we can find something to offer you”
The end result? – Approximately sixty seconds later they had halved my interest rates across the board for both my outstanding balance and for all new transactions for the next six months. Roughly saving me $200-$300 a month for the next six months.
Admittedly I dont have the insurance protection (on this particular card anyway) I mentioned above but one thing at a time. Wouldn’t you like a $200 interest saving on your card?
Have you asked your credit card company for a deal? Had to claim on a warranty and gotten help from the credit card company? Got a hot tip on a card for us for Christmas? Leave us a comment and dont forget sharing is caring!
***Photos thanks to Eliazar & familytreasures***