Just checked my credit card statement ...

[CoP Luv]

I'm so frustrated.

When you get mad enough, you can move mountains. Good for you for all of your hard work to learn and make changes instead of being complacent. Keep it up, even when it’s hard and frustrating.

 

[WinterSolider]

we had an issue on one vacation with disney making a mess of charges that took weeks for them to fix (despite our credit card company telling them exactly what they needed to do) so we learned our lesson on always traveling with an additional card. we only have one that charges a fee but it's the one we take on vacation b/c it has allot of extra travel benefits one being if it's international travel they don't charge a foreign transaction fee. we only pay $49 a year (credit union) and since it does 2% rewards on groceries i just make a point of using it and then paying the yearly fee with the rewards.

There are several cards that do 2% rewards on everything with no annual fee.

I'm not anti-annual fee, I have 17 open credit cards with total annual fees if about $1,600 but paying $49 for a 2% grocery card is a very poor value.

 

[WinterSolider]

I just got off the phone with both CC2 and CC3. I canceled the credit protection on both cards. That'll save roughly $20 per month. I also talked to CC3 about the fees. They say the annual fee for the first year was $175. This year it was $200. They charged me $50 in July for a 1-time fee then take the other $150 out in 12 monthly fees of $12.50 apiece. I asked how they could get away with it, and he had no answer. I also asked the payoff amount, and I got that. I went to pay that amount online, but it would only let me pay a certain amount. So will pay it down to 1 penny left on the balance, lol. Not sure how to take care of that since it wouldn't let me pay more than it showed online. I guess I will have to pay the difference when the regular payment is due.

You don't have to wait to pay it off before you close it. Close it immediately. Then they'll send you a final bill.

 

[barkley]

There are several cards that do 2% rewards on everything with no annual fee.

I'm not anti-annual fee, I have 17 open credit cards with total annual fees if about $1,600 but paying $49 for a 2% grocery card is a very poor value.

i don't pay $49 to get 2% on groceries it just happens to be one of the benefits of that card along with other categories of up to 6% but the rewards are just something i get with it/not something i seek or sought out. it's the only card i have that i pay a fee on and gladly so b/c i use it in place of a debit card which is much more difficult (and financialy dangerous/time consuming) to deal with in the case of fraud. my local credit union is spectacular on fraud monitoring (personal call from in-house staff if something odd pops up as a pending charge) and disputes are handled in record time absent back and forth electronic communications/requests for documentation/prolonged hold times in a phone tree hell to reach a live person in an outsourced dispute department. i can walk into one of their many branches and get face to face help if i desire.

in reality our household is fortunate to have reached a 'cash only' operating model-we just have 3 forms of cash:

traditional
written (old school checks)
plastic (credit cards).

not much use for traditional anymore UNLESS it's a specific vendor that with an established time and trust relationship who offers a cash discount (and i don't want the extended warranty or other price protection coverage a credit card offers), written (checks) are largly for medical (so i can track patient/provider/date of service, property taxes (self pay), siriusxm (they won't get my card number to be able to auto-renew at a higher cost) or vendors that upcharge for using plastic (unless the upfee washes with the rewards OR i want extended coverage/protection). plastic is for everything most people use a debit card or auto pay from a checking account so long as a fee is not associated. if a high cost repair or replacement comes along and the vendor does do an upfee i balance how much that fee is vs. the rewards (usualy a wash) but i also consider the value of extended warranty coverage on a particular purchase (we have availed ourselves of this coverage in the past to the tune of electronics being replaced/costly repairs on items being reimbursed by the card companies).

i think the card i primarily use gave us a $250 reward bonus when we signed up and no first year fee so that covered us for what? 6 years. even if we just used it for grocery store purchases we would cover almost 5 years of fees with the rewards earned in a single year. not a bad rate of return.

 

[WDW_fan_in_TX]

I closed it and paid it off on the phone. The payoff was 1 cent less than what they told me last night. I told the lady 3 times I didn't think that was right, but she said no it's correct. I told her if I get a bill for a penny, I'm not paying it (I would, but it's just telling her that). But she was adamant on the amount, although it was a penny less than last night. But, it is paid off. Now I just have to hope and pray nothing around the house goes out. Because I have no money set aside to pay it.

You don't have to wait to pay it off before you close it. Close it immediately. Then they'll send you a final bill.

 

[Nettlelondon]

Well done on getting rid of one burden. Cross the bridge of something going wrong when it happens - hopefully you will have more options by then and will be more in control of where you are in your financial life.

Now just work on paying as much as you can on the other cards every month to reduce the balance - try to avoid paying just the minimum if at all possible. As you have seen that really doesn't progress much.

Don't close the other cards - and once you get the balances down you can look at alternate fee-free cards that you may become eligible for in case of emergencies.

You really are making progress - great work. You should be very proud of yourself. It's hard work but you are taking control.

 

[tvguy]

Finally got around to looking into getting a second credit card last night. About a dozen options through my bank, all but two without an annual fee. And those two were very specialized. One gave rewards specifically for charges for entertainment tickets, sports tickets, and ski resorts. The other was a business card.
I haven't applied for a credit card since 1996, so the process is different. Filled out the application online, hit submit and was approved in 30 seconds. I have limited charging ability until the physical cards arrive and I activate them, but now I can see how easy it is for people to get in credit trouble if getting a card these days is this easy. And my credit monitoring works, it alerted to me to the credit pull immediately.

 

[barkley]

Finally got around to looking into getting a second credit card last night. About a dozen options through my bank, all but two without an annual fee. And those two were very specialized. One gave rewards specifically for charges for entertainment tickets, sports tickets, and ski resorts. The other was a business card.
I haven't applied for a credit card since 1996, so the process is different. Filled out the application online, hit submit and was approved in 30 seconds. I have limited charging ability until the physical cards arrive and I activate them, but now I can see how easy it is for people to get in credit trouble if getting a card these days is this easy. And my credit monitoring works, it alerted to me to the credit pull immediately.

it was still easier back in the day before credit card reform happened-onsolicited cards arrived in the mail all the time. got them from department stores, jewlery stores, electronics stores, all access use-activated and ready to use student debt these days primarily refers to student loans, back then it was the horrific credit card debt that was the result of endless cards mailed out with no application ever made.

 

[aea71]

I closed it and paid it off on the phone. The payoff was 1 cent less than what they told me last night. I told the lady 3 times I didn't think that was right, but she said no it's correct. I told her if I get a bill for a penny, I'm not paying it (I would, but it's just telling her that). But she was adamant on the amount, although it was a penny less than last night. But, it is paid off. Now I just have to hope and pray nothing around the house goes out. Because I have no money set aside to pay it.

Great work! Like others have suggested, Dave Ramsey's Total Money Makeover is a great system to help with paying off debt and really digs into the psychological aspects of how to accomplish it. I don't necessarily agree with everything that the program says but I think most people would benefit from first establishing a small emergency fund ($1,000) and then progress into paying off and closing credit cards after the emergency fund is funded. Putting an emergency on a high-rate/annual fee credit card only creates a deeper hole to dig out of.

 

[focusondisney]

I closed it and paid it off on the phone. The payoff was 1 cent less than what they told me last night. I told the lady 3 times I didn't think that was right, but she said no it's correct. I told her if I get a bill for a penny, I'm not paying it (I would, but it's just telling her that). But she was adamant on the amount, although it was a penny less than last night. But, it is paid off. Now I just have to hope and pray nothing around the house goes out. Because I have no money set aside to pay it.

That explains why it wouldn’t let you pay off that last penny. My Chase cards won’t let me pay more than my balance either. The payoff number you got before was probably just a penny too high.

Hopefully if anything goes wrong it’s something your landlord has to fix.

 

[barkley]

Great work! Like others have suggested, Dave Ramsey's Total Money Makeover is a great system to help with paying off debt and really digs into the psychological aspects of how to accomplish it. I don't necessarily agree with everything that the program says but I think most people would benefit from first establishing a small emergency fund ($1,000) and then progress into paying off and closing credit cards after the emergency fund is funded. Putting an emergency on a high-rate/annual fee credit card only creates a deeper hole to dig out of.

great suggestions! i will add that while you are establishing an emergency fund and paying off those credit cards to start tracking some of the non monthly expenses you have (that we ALL have) so that when you are no longer paying off the cards you can take some of your monthly budget and earmark it into a separate savings account so that when those expenses come up you have the money in reserve and your regularly monthly budget does not have to take a hit. things like-

car registration/tab renewals
regular car servicing (if you don't do it yourself)
for public transit users-90 day passes
bi-annual siriusxm subscriptions....

add up what it's cost you over the past year/bump it up each year by maybe 10% for cost increases and divide by 12. we find it's allot easier to stay on track with our established month budget by throwing 1/12th of those yearly costs each month into that separate account and pulling from it to make the payments (and we let anything leftover year to year just rollover so if a larger car repair or something comes up it's there).

 

[CAPSLOCK]

I don't necessarily agree with everything that the program says but I think most people would benefit from first establishing a small emergency fund ($1,000) and then progress into paying off and closing credit cards after the emergency fund is funded. Putting an emergency on a high-rate/annual fee credit card only creates a deeper hole to dig out of.

Eh, I think it would be preferable to pay off existing high-rate credit cards before focusing on an emergency fund. You're getting rid of definite high interest payments rather than saving money to ward of maybe-having-to-pay-high-interest later.

Depending on how emergently you need access to your emergency fund, you can often get a new credit card with 0% interest for the first XX months. I did this for an unexpected plumbing bill - put that sucker on the card then paid it off over 15mos. Worked great.

 

[WDW_fan_in_TX]

I was checking my Credit Karma report, and it shows my credit usage at 96%. I paid off the Milestone card, but by closing the account, it won't drop that usage amount. It will show my credit usage still at above 90%. Did I do the wrong thing? If I'd have kept the card open, my CC usage would've dropped to less than 50%. According to CK, CC usage is big factor. Now I regret closing the card, lol. Or am I thinking wrong on this? (Please tell me I am).

 

[greeneyedchick]

Eh, I think it would be preferable to pay off existing high-rate credit cards before focusing on an emergency fund. You're getting rid of definite high interest payments rather than saving money to ward of maybe-having-to-pay-high-interest later.

Depending on how emergently you need access to your emergency fund, you can often get a new credit card with 0% interest for the first XX months. I did this for an unexpected plumbing bill - put that sucker on the card then paid it off over 15mos. Worked great.

I would add that the key to getting a 0% interest credit card for an emergency is to use it for that emergency only and don't use it again. The 0% interest is only for that intro time. If you charge something else to it later, the credit card company will apply any payments to the 0% interest principal and you'll be paying a high interest rate on the new charges. The only way to stop the interest would be to pay the entire thing off.

For example, we had to buy a hot water heater when we didn't have the money. We opened the interest free credit card, charged the water heater and then didn't use that card again until it was paid off. Had we charged anything after that time, all of our payments would have applied to the interest free principal while high interest on the new charges accumulated. It would have defeated the whole point of getting that 0% interest promotion. lso realize that you must pay off the principal in it's entirety BEFORE the interest free period is up. If you wait until you get the bill with interest, it's too late. They will add all of the months of 0 interest and apply the current interest rate. For example, if you get 6 months 0% interest, at 6 months and 1 days, the company will charge you compounded interest for all 6 months. Make sure to save up the payoff amount in time or put monthly payments toward the principal instead of the minimum payment. Hope that was clear. Trying to educate you on the nuances of credit cards so that you don't find yourself in a new costly situation.

Congrats on closing a card and getting a no-fee card.

 

[CAPSLOCK]

Now I regret closing the card, lol. Or am I thinking wrong on this? (Please tell me I am).

Closing the card was the right thing. The few extra points on your credit score are nothing compared to the outrageous fees they were charging you. You can always open a new zero fee credit card if you want to have less credit usage. And/or as you pay down your other 2 cards, your usage will reduce naturally.

We opened the interest free credit card, charged the water heater and then didn't use that card again until it was paid off. Had we charged anything after that time, all of our payments would have applied to the interest free principal while high interest on the new charges accumulated. It would have defeated the whole point of getting that 0% interest promotion.

This is not the case that I'm aware of. I certainly charged lots to my 0% intro interest card, every single month, and it stayed 0% interest throughout the whole 15mos. Never paid one cent in interest. Just made sure to pay it off before the intro period ended.
I do think what you're saying might be true for balance transfer 0% interest offers (if you do another balance transfer after the "new account" period, they will charge interest on everything on the card).

lso realize that you must pay off the principal in it's entirety BEFORE the interest free period is up. If you wait until you get the bill with interest, it's too late. They will add all of the months of 0 interest and apply the current interest rate. For example, if you get 6 months 0% interest, at 6 months and 1 days, the company will charge you compounded interest for all 6 months.

This is for sure true. And how they expect to make money with those 0% interest offers.

 

[ruadisneyfan2]

I was checking my Credit Karma report, and it shows my credit usage at 96%. I paid off the Milestone card, but by closing the account, it won't drop that usage amount. It will show my credit usage still at above 90%. Did I do the wrong thing? If I'd have kept the card open, my CC usage would've dropped to less than 50%. According to CK, CC usage is big factor. Now I regret closing the card, lol. Or am I thinking wrong on this? (Please tell me I am).

By closing the card, you have cut off your available credit. So the cards you do have are still close to their limits. As you pay them down, your available credit increases and your % of use will decrease.
Normally, I would say leave that $0 balance card open to keep that % use lower, but they are robbing you with fees so in your case, it is better to just close it and stop the fees.
Look at every single bank/bill fee you pay and find a way to make them all stop. That is $ you could be applying as a payment to a cc even if it’s only $3. It shouldn't cost you a penny to pay your bills.

When I first started paying down our debt, it would drive me bonkers that our local bank (I’m looking at you, TDBank, you POS!) had a $100 minimum balance requirement. If the balance ever dipped below $100, even at $99.99 for only one day, they would apply the fee. So I saved up a $200 buffer so we would never come close to paying their evil fees.
Shortly after that, we had a new bank come to town with no minimum balance and switched banks. Right now, the only way we can incur a fee is if we were overdrawn which doesn’t happen because we follow our budget plan very closely. It takes time and effort but well worth it.
I will never get into debt again unless something catastrophic happened.

 

[ruadisneyfan2]

Closing the card was the right thing. The few extra points on your credit score are nothing compared to the outrageous fees they were charging you. You can always open a new zero fee credit card if you want to have less credit usage. And/or as you pay down your other 2 cards, your usage will reduce naturally.


This is not the case that I'm aware of. I certainly charged lots to my 0% intro interest card, every single month, and it stayed 0% interest throughout the whole 15mos. Never paid one cent in interest. Just made sure to pay it off before the intro period ended.
I do think what you're saying might be true for balance transfer 0% interest offers (if you do another balance transfer after the "new account" period, they will charge interest on everything on the card).


This is for sure true. And how they expect to make money with those 0% interest offers.

What greeneyedchick said is true. I have learned that the hard way.
For example, say you open a new card for it’s 0% balance transfer offer and they give you a $3000 limit. Next you transfer $1500 to this card and you still have $1500 available credit.
If you keep using that card to make purchases, let’s say you buy groceries and go to Home Depot and both of these add up to $500.

You get the bill next month and it shows all 3 transactions. You send a payment of $500 and you want them to pay off the groceries and HD charges but no, they don’t. The payments are applied to your $0 balance transfer balance which will then be $1000. In the meantime, your 2 purchases start accumulating interest.
Let’s say $ is tight and you can only send $100/month to this card. For the next 10 months, they will keep applying your $100 payments to the BT balance and meanwhile, your $500 groceries and HD charges have been racking up interest for the past 11 months with not a single penny applied to lower that balance.

So she is saying, if you’re going to take advatage of a 0% BT offer, do it but don’t use it for anything else, at least until that BT balance is paid off and you have a statement that shows a $0 balance.

 

[greeneyedchick]

This is not the case that I'm aware of. I certainly charged lots to my 0% intro interest card, every single month, and it stayed 0% interest throughout the whole 15mos. Never paid one cent in interest. Just made sure to pay it off before the intro period ended.
I do think what you're saying might be true for balance transfer 0% interest offers (if you do another balance transfer after the "new account" period, they will charge interest on everything on the card).

You are right. My apologies. I was referring to 0% interest balance transfers or the ones that give you 1 or 2 checks to use for 0 interest.

 

[trenty]

I was checking my Credit Karma report, and it shows my credit usage at 96%. I paid off the Milestone card, but by closing the account, it won't drop that usage amount. It will show my credit usage still at above 90%. Did I do the wrong thing? If I'd have kept the card open, my CC usage would've dropped to less than 50%. According to CK, CC usage is big factor. Now I regret closing the card, lol. Or am I thinking wrong on this? (Please tell me I am).

I wouldn’t worry about this.

As others here have said - focus on building up a starter $1000 emergency fund before paying off the other cards.

 

[CAPSLOCK]

As others here have said - focus on building up a starter $1000 emergency fund before paying off the other cards.

I'm curious why? Wouldn't paying off the cards which are actively charging 29-31% interest be better than putting money away for "maybe"? An emergency could always be charged to a card, and likely for similar interest rates... and if there is no emergency, then you have been paying extra interest for no reason.