- Read and understand all notices.
- Call and ask questions. Be careful of "scripts" that sound like they are being read from a screen. Misunderstanding these will most likely cost you.
- If your rate increases, freeze your account before the deadline to keep your old rate. You cannot use that card until the balance goes below a certain limit, but you will save money.
- When you call, write the name, date and times for each call. If you are transferred, make sure to get the new person's name.
- Call the next day to confirm the change. Personal experience and many first-hand stories from trustworthy friends and acquaintances suggest that data entries in favor of the consumer are often lost. Don't rest easy if they assure you they've fixed the problem. You MUST call back until a new person says they see the change on their screen at the start of the call. While calling several times is annoying, being cheated feels much worse.
The Pay Ahead Elimination Notice Decoded
Do you rely on tried and true routines and automatic systems to pay bills on time? If you've been hoping for a little bill paying excitement, you could be in luck. Paying on time could be more of an adventure if you get a Pay Ahead Elimination Notice. Strategies you've been using to avoid interest and late fees may no longer work because, well ... I guess someone figured out they help you avoid interest and late fees!
These are actual phrases from different notices:
- You may no longer make minimum payments in advance.
- You must pay the Total Minimum Due each billing cycle.
- A minimum payment will be required for every statement with a balance, even if you paid more than the minimum payment or made multiple payments in a previous billing period.
- We will no longer apply any portion of payments in the current billing cycles to Total Minimum Amount Due.
Here is what it means:
Paying too early is just as bad as paying too late! If a billing cycle runs from November 1 to November 28, your payment must be recorded between those dates to count for that billing cycle, NOT EARLIER.
Here is what you need to do:
- Be alert to any notice that changes the number of days in your billing cycle.
- Fill in a calendar for a whole year with the due dates. In a 28 day cycle, you can't count on paying on the same day each month.
- Don't pay even one day earlier than the start of the next billing cycle. Credit card companies aren't big on paying it forward. You'll end up with multiple payment for one billing cycle and a zero payment for the following month. Then you'll have fees, higher interest rates and lower FICO scores for a long time.
- Don't trust the US mail OR the person opening the mail at the credit card company. Use online bill paying from your checking account. You can sit down once and schedule future payments for the whole month. This gives you a confirmation of the payment date and gives you control of timing. You also save on stamps!
- Sign up for email payment reminders. Good credit card companies offer this for free.
My December 2007 article, Credit Card 101: What The Fine Print Really Means, gave some basic strategies, defined some terms and hopefully prepared some people for the meltdown that has taken almost a year to materialize. Forcing yourself through the tedium of that piece might not be a bad idea. With companies raising rates and changing rules for card members who have a perfect track record, the penalties are even worse if you make a mistake. Fight back with a few smart moves of your own! The winner of this game gets to keep YOUR money! Good luck and be careful out there!
Dinner at Citricos, Grand Floridian
Dinner at Citricos, Grand Floridian - photo by PixieMichele
About the Author: Sandra Bostwick is an occupational therapist, music therapist, and adjunct professor at County College of Morris. She owns Creative Learning Studios and enjoys motivational speaking and writing. She has experience in the travel and entertainment industry on land and sea, but dreams of earning a Walt Disney World cast member pin one day.
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