Don’t You Want To Know The Secret?
How IS credit card interest calculated?
Credit Card interest is calculated on the due day of every month, so the way to escape paying any interest on your credit cards, is to pay the entire balance prior to the payment due date. Not only do you escape paying interest on using the credit card company’s money, but you also rack up rebates and rewards for using your credit card.
What if I can’t pay my entire balance off at the end of the month, how is the interest calculated?
If you can’t pay your entire balance by the due date, pay what you can, but before the due date to escape any interest being incurred on the amount you are paying on your balance. Once you are in the next billing cycle, you will start to incur interest immediately after each purchase on your card. If you keep a balance on your credit card, then interest is incurred immediately after each purchase. This is how your credit card balance goes up so quickly and can become unmanageable.
Now we know!
Now that we know how interest is calculated, we can use this knowledge to benefit yourselves and earn rewards and get cash back. So what do you like, Cash Back rebates or Frequent Flyer miles? Whatever your desire is planning a trip out of the country, don’t pay for the airline tickets, use a credit card that offers frequent flyer miles for every dollar you spend. Remember, pay the monthly bill off each month prior to the due date and reap the rewards.
So What is Next?
As your Financial Success Coach, I will partner with you to come up with a plan to pay of any existing balances on your current credit cards so that we can start taking advantage of the rewards credit cards offer. You will be amazed at how easy this is. I know of a lady that deposited $1500 into a checking account that offered her a credit card that paid rewards on a 3, 2, 1 scale. She paid her credit card balance off each month and at the end of the year she earned over $1300. She paid no interest for using her credit cards and made almost 100% of her deposit.
Wouldn’t you like that?