If you don’t know here is a little stat for you – More than 42% of households have credit card balance of around $6370. Reading this fact you must be wondering : What is a credit card balance and why is it so important. Well this is the topic we are going to discuss in this article.
What is a Credit Card Balance?
A credit card balance is the amount of money you owe to your credit card company for the purchases you have made through your credit card. Most credit cards provides the facility of checking your current balance by logging into your account. To understand more deeply about, What is a credit card balance, How it is calculated and how you can control it then you can continue reading this article.
How To Calculate Your Credit Card Balance?
The most simple way for calculating your credit card balance is by logging into your account. By logging in you can view most of your current balance or you can call up the customer service number of your credit card provider to get a better clarity.
Best Ways To Control Your Credit Card Balance.
If you are already dealing with a credit card balance, The best option for you is to repay the MAD (Minimum Amount Due) each month so that you can save your money from an extra late fee’s charge which will also impact your credit score in the future.
One of the best ways to avoid credit card balance is to only spend what you can afford to pay off later. The biggest mistake that people often do is to use one credit card for paying the debt of another credit card. By following this activity you are throwing your hard earned money into balance transfer credit card fee’s.
For example – Imagine I am making a balance transfer of $5000 then i am usually going to be charged a balance transfer fees of 3%, Which makes it $5000+$150 (3% of $5000).
The best scenario is to take up a credit card which provides 0% APR (Annual Percentage Rate) for a certain period of time. You can find several credit cards that will provide you with 0% APR (Annual Percentage Rate) for the first 6-12 months.
A 0% APR (Annual Percentage Rate) card means that you don’t have to pay any interest for a set amount of time on balance transfers in your credit cards and your purchases.
By using a 0% APR card you can avoid the interest charges, Keeping in mind that you pay off the debt before the offer ends.
I know it can be a little hard to get rid of your credit card balance, But you can at least give it a try by following some of the steps that we have discussed in this article. As you have a better clarity on what is a credit card balance and how to control it, So now you can implement these things to improve your financial situation.