Penny Seeds

While it seems like a good deal you really might be doing yourself more harm than good to get a lower rate. A high interest rate can cost you lots of cash every month, but a lower one might cost you more in the long term.

Credit card companies are getting all kinds of hell rained down on them for their recent rate hiking actions. People are furious that they’re rates are being  jacked up sometimes three times what they were for no reason. Guess what! They don’t need a reason to raise your rate.

If you’re constantly late, over limit, ect. that might give them the heads up that they need to raise your rate to get rid of you or suck out some more cash because you’re a ‘higher liability’, but they can do it anytime!

Many people are calling their issuer to get a lower rate, and I thought about that for a few minutes before I decided it was pointless! If I was guaranteed that lower rate for any amount of time; then yes it would be a great plan for me! If I had thousands upon thousands of dollars of debt I could potentially save a lot of money.

However, the fact is they could raise it double next month if they wanted to do so. That doesn’t seem very secure to me, and it could be very dangerous for you. The less something has a financial impact on you the more trivial it becomes in your mind, but imagine this scenario.

Let’s say you have an unattractive rate of 18% on your current card. You call up your credit card company, and spend a good hour complaining until they knock you down to a 12% rate to get you off the phone. Great! You think to yourself, and proceed to hand out your plastic to ever retailer in town.

A couple months later your card issuers sees that you have acquired a good amount of debt thanks to your lower rate, and decide to put you up in to a 25% interest rate. This number sounds unreasonable, but it’s not an exaggeration. I recently went to a rate comparison site, and one of the ‘comparable’ rates was a card with a whopping 39% interest rate on it! That’s the ‘low’ one they were advertising - So imagine what they charge some people!

I decided that having a lower interest rate would just encourage me to keep money on my cards, and that’s not what they’re for! I keep credit cards around to boost my rating, and for emergencies. (Car repairs, ect.)

Ultimately you want zero dollars on your credit card. That means no interest money for greedy creditors; so who cares if they up my rate to 75%? I just won’t give them any money.

Instead of a getting a better rate to keep yourself in debt - Spend that time shopping around for bigger returns on your savings, CDs, stocks,  retirement fund, ect.

If you owe a lot of money already go ahead, and get the best rate you can, but don’t slack! Pay that balance off as fast as you can. Spending money that isn’t yours is dangerous - And millions of people are in trouble because of it. Keep your cards to..

*Raise your credit score.

*For emergencies

*Rewards programs (But pay it off before you owe more than you bought!)

• Using Business Credit Cards in Business Solutions If you haven’t yet recognized the benefits of owning a business credit card, it’s definitely a matter worth your consideration. Aside from enabling you to separate your business finances from your personal money, business credit cards offer more advantages. Let’s take a closer look at some of them. Build your......
• Job Scams - Criminals Are Working Harder Than Ever! It's a tough time for the United States economy, and unfortunately there are those out there looking to take advantage of people that already are barely making ends meet. While it's true that there are plenty opportunities to be had it's also important to be weary of fishy situations.......
• Have a very merry - Economical Christmas! Lots of people are cutting their budgets this year, and retailers are taking notice. Stores large and small are slashing prices to garner more sales. Some people are even considering buying no presents this year which is a big no for me. Just because you're feeling a little pinched......
• How To start Investing With Almost No Money Lots of people would love to dump oodles of money into investments that would benefit them in the future, but they just don't have it! If you're one of those people you may have been lead to believe that you need a ton of money to start investing. Not......
• How High Of A Risk Is Your Landlord? There's plenty people down on their luck in the housing market so did you ever stop to think about your land lord's financial situation? Considering how many properties they own, empty houses everywhere, and even their own personal debt may save you big trouble! You might be the only......

• How To Get Your Credit Card Interest Rate Reduced The more money you pay in finance charges on your credit cards, the less you're paying towards principal.  And the less you're paying towards principal, the longer it will take you to get out of debt.  Fortunately, it's not overly difficult to get your credit card interest rates reduced, and......
• How To Hedge Your Bets: 10 Ways To Diversify Your Income Jonathan Leane is today's guest blogger here at Rich Credit Debt Loan. Jonathan writes for Debt Loans. Why Diversify Your Income? Most people are familiar with the idea of diversification—it is common knowledge to not “put all your eggs in one basket”. However, this advice is most commonly applied to......
• 3 Reasons Why Paying With Cash Hurts You in the Long Term Many of us have been conditioned to think that living debt free is the only way to be. While there is some truth in this statement, if you’re completely debt free and using only cash, you’re hurting your chances of getting a new home, and you may end up in......
• Current Savings and Checking Account Setup Yesterday I blogged about the organization and how I keep track of my personal finances. Now I'll try to shed a little light on my current savings and checking accounts, as well as what I may do in the future. Currently, I have one checking account, which is a local......
• How to Negotiate Lower Interest Rates with Creditors You hold a lot more influence over your credit picture than you might think.  Even though things are difficult right now for many consumers, it actually plays more into your favor when it comes to working with creditors for relief on loans and credit cards.  The reason is that they......