The following blog is taken from a post in the Geezeo group Quarter Life Crisis by Her Every Cent Counts.
Looking into my wallet, I noticed I had several credit cards, but NO CASH!! That got me thinking… Where is all my cash going?
I went online that night and looked at each one of my credit cards – some had an APR (annual percentage rate) as high as 24% (average APR is 14.53 %*)!!! That is literally just throwing money away!
I called up my father, who is ex-military (you get the idea), and told him about my lingering financial problem. He immediately looked at his calendar and scheduled a meeting with me the next Friday night – not my idea of fun to start off the weekend! He instructed that I bring all 4 of my credit cards and print my statements offline.
Friday night rolled around and I showed up with all of my credit card information in tow. He instructed that I sit down and we end this craziness right away. He got on the kitchen phone, and I got on the cordless phone.
I picked the first credit card out of my wallet, a Citi Bank card, flipped it over and dialed the customer service number on the back. After at least five minutes of automated, and annoying, prompts, and after waiting on hold for another five minutes, I was put in touch with a representative. She asked how she could help me, and I asked her what my annual percentage rate was. She said 15%, which, although close to the average, is still a lot. My dad immediately chimed in with, “That is crazy! You’re going to have to lower that or cancel her card.� A little startled, she typed on her keyboard and said that she could change it to 13%. “That’s not good enough, cancel the card!� was my dad’s response.
She said that she was sorry that she couldn’t get us a better APR, but would put us in touch with Citi Bank’s financial representative. After another few minutes of holding, a man came on the phone and said that he would lower my APR to 7.9% and thanked me for being a customer.
Wow – I just almost cut my interest rate in half. Feeling better it was on to the next credit card…
Two hours later, when we were both exhausted, we had cancelled one card (couldn’t lower the APR enough), and significantly reduced the other three. I’m in the process now of finding the best card to transfer my closed account balance to. I know that closing my credit card hurt my credit score, but at this point, I can use the extra cash and feel that I’m young enough to rebuild the reduction quickly!
I guess the lesson here is: Ask – Depending on your debt, you could be saving hundreds, if not thousands of dollars by making one phone call!
*March 2, 2007 survey:
http://www.consumer-action.org/news/articles/2007_credit_card_survey/
August 24th, 2007 at 2:42 pm
Couldn’t agree more interest rates are just like throwing away money, dosen’t it piss you off really badly, that money could be used for so much more
November 13th, 2007 at 5:42 am
That’s fantastic! Thanks for the prompts. You gave an excellent piece of advice! But still after cancelling my cards I will have to look for a credit card to restore my credit!