Credit card debt is not something you want to carry for any significant length of time. Minimum monthly payments plus interest can easily total hundreds or thousands of dollars. Therefore, it is in your best interest to look at ways that you can significantly reduce or completely eliminate credit card interest.
Look Into a Balance Transfer
A balance transfer allows you to take a balance from one card or several cards and consolidate it on another card. The goal is to find a card that offers a 0 percent introductory rate on both new purchases and balance transfers. If you are currently paying an interest rate of 10 percent or more, you could save a lot of money each month that could go toward paying down your principal balance as opposed to enriching your lender.
Ask for a Rate Reduction
In some cases, you may be able to reduce your interest rate just by asking. This may work if your credit score has gone up or anything else has occurred to make you are more reliable borrower. If you have a history with the lender, it may be worth your while to ask for a rate reduction as the credit card company may be interested in keeping your business at a lower interest rate as opposed to losing you completely. It is important to keep in mind that your request may not be granted the first time you ask. Therefore, be ready to negotiate over a period of days or weeks until you get the deal that you want.
Use Cash Back to Pay Down Your Balance
If your card allows you to get cash back when you make a purchase, use that money to pay down your balance. Although you may still be required to make a minimum monthly payment, reducing your balance reduces the amount of interest that you have to pay. This means that you benefit twice because you aren’t using your own money to make a payment while you are reducing the amount that you will have to pay each billing cycle. If you pay your credit card bills online, all you have to do is hit a button or otherwise instruct your lender to apply cash back to your balance.
Credit card interest rates can be as high as 29.99 percent. If you make only your minimum payment, you could pay thousands of dollars more to your lender than you borrowed originally. By using cash back to lower your balance, using a balance transfer or simply asking for a lower rate, you can pay what you owe faster and gain control over your finances.