Credit card notes to cardholders – Part 1Posted on October 14th, 2012 under Wealth of Advice
By Francisco J. Colayco
Our reader gives very practical tips that she and/or her family have been following to stay out of credit card debt. Here is a chance to just listen to one who has actually experienced the credit card issues in real life. Though she does not want to be identified, hers are words of wisdom.
STATEMENT DATE MATTERS
You must always remember the statement date of your credit card because this determines how much you spent within this period. For example the statement date of your credit card is every 5th of the month. If today is March 5, then all your transaction from February 6 up to March 4 will reflect on your next credit card statement. It is better to use the credit card AFTER THE STATEMENT DATE. So for example, if March 5 is the statement date, then it is advisable to use the credit card from March 10 to April 4. This way, the charges you incur will be included in NEXT MONTH’S STATEMENT, and not in your CURRENT MONTH’S STATEMENT. Here is a rule of the thumb: Charges made before the statement date will be included in the current month’s billing statement. Charges made after the statement date will be included in next month’s billing statement. I have done this many times, I enjoy credit days which reach up to more than 40 days. This means that I have more days to save for my credit card bill. And when the due date comes, I ALREADY HAVE THE FULL PAYMENT FOR MY CREDIT CARD BILL.
WHEN YOU PAY THE MINIMUM, YOU GIVE THE BANK A MAX INCOME
Sir Colayco’s advice against paying the card’s minimum really makes sense. Paying only the minimum is the reason why you slowly drown in credit card debt due to interest. You are only making the banks wealthier at your own expense. If for example your minimum is Php 1.5k, don’t be tempted to pay just this amount. If you can’t pay in full, then it is better to pay another 1k on top of the minimum. This will help you pay your obligations faster and make the interest accumulate slower.
YOU CAN REQUEST THEM TO WAIVE THE ANNUAL FEE
Actually it was my sister who did this. You can request them to waive their annual fee so you can pay them faster.
BSP circular #454 states that collectors must be well-mannered; they must not be offensive. The moment the collector raises his/her voice, get his/her name or agent code immediately. The calls are surely recorded. Immediately tell the agent that you want to contact his/her supervisor and complain about the agent’s behavior while invoking BSP Circular 454. If the agent’s tone of voice is disrespectful, he/she can be fired. (I saw this on TV but please make further research on this.) You can also check this site: www.failuretopaycreditcard.blogspot.com. This is a fantastic blog which advises credit card defaulters to stand firm against collectors who use threats or harassment to force payment.
More next week from our shy sharer.