Credit Cards and Debt Interview with WRKO Radio Boston
Male: We’re now joined by Matt Schulz from CreditCards.com here to talk about some new year’s resolutions for people with their credit card debt. And, Matt, thanks for joining us.
Matt Schulz: Thanks for having me.
Interviewer: Matt, I want to talk about one of the tips that I had here. And id o this very often with my cable bill, but I didn’t realize it may work with a credit card bill as well. And that’s asking for a lower interest rate. Negotiating.
Schulz: Yeah. Negotiation is really possible with your credit card companies and a lot of people might not believe that. But we did a survey a while back that showed that even though only about one in four card holders have ever asked for a lower rate, about two-thirds of those who did ask were successful. So that means that a lot of people are paying more interest than they need to be paying.
Interviewer: And, Matt, we can apply for a balance transfer?
Schulz: Yeah. A balance transfer credit card can be a pretty good option for folks with a lot of debt. Especially ones that come with zero percent introductory period. A couple of the cards that we recommend are the Slate from Chase, which has no interest on balance transfers for 15 months and no balance transfer fee if you do it in the first 60 days after getting the card. Then there’s also the Citi Diamond Preferred card which you’d pay zero interest for 21 months. Which is a really long time. Although it does come with a 3 percent balance transfer fee.
Interviewer: Now obviously you have to determine how you got into debt in the first place. But some suggestions may be if you’re consistently spending beyond your means how can you cut down on that?
Schulz: Well, creating a budget can be a very useful thing to kind of be a little bit of a roadmap to help you control your spending. Cause I think that if you can see explicitly how much money you’re bringing in and how much money is going out that can be a bit of an awakening to people and can help people control themselves a little bit.
Interviewer: Cutting expenses like maybe you don’t need that premium TV package. Or maybe that gym membership. You haven’t been there in the past five months.
Schulz: Yeah, yeah. Cutting the cord on cable or skipping the gym. Or even selling something of value that you own that you just may not use anymore. Those can all be – those are all little things, but they can be impactful when you add them all up together.
Interviewer 2: Matt, when we talk about credit card rates heading into 2016, with the Federal Reserve having just done – really just executed their first interest rate hike in about ten years, that has bumped up rates on some cards, correct?
Schulz: Yeah. Generally speaking, people’s credit card APRs have gone up by that same quarter point that the Fed raised rates. And even though people might not really notice that yet, if you add on the three or four more rate hikes that a lot of people say are coming, after a while you will start to notice that pile up. So that’s just yet another incentive to pa that debt down now.
Interviewer 2: Do you have any information on what type of balance most people are carrying on their cards that that interest is applied to?
Schulz: Generally speaking the average household that has credit card debt has about 9 or 10,000 dollars in credit card. And that’s a lot of money.
Interviewer: That is a lot.
Schulz: So when you think about cutting the interest rate on that, you could end up saving hundreds of dollars potentially.
Interviewer 2: Yeah. It’s very real money. What other tips do you have for people that are looking to get their affairs in order from a credit card perspective heading into next year?
Schulz: Well, really it’s all about, again, like we said, kind of knowing yourself and making sure that you kind of understand your situation as it relates to cards. And one thing that can help if you’re somebody who’s a habitually late payer is setting up autopay. That can be something that kind of takes some of the worry out of your hands as long as you make sure to set it for an amount that’s more than the minimum.
Interviewer 2: Yep. Yep. Very good. Well, Matt, I appreciate you joining us. And to you and your family a Happy New Year’s.
Schulz: Same to you and yours.
Interviewer 2: Matt Schulz from CreditCards.com.