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You don’t have to organize a Halloween party to scare your children and family members. Credit card companies are there to scare all of you. In spite of the pro-consumer laws made through the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act, the market is flooded with cards manufactured to ruin your financial health faster than any professional murderer.

Check out the 4 ways in which the credit cards kill you financially.

1. Gigantic fees in return of an empty casket of rewards: People with good credit score may be proud to boast of their reward credit cards. However, some of these credit cards come with horrible interest rates. Some rewards are not that exclusive yet people have to pay almost $495 annual fees for the credit cards.

2. Balance transfer credit cards burn a hole in your pocket: Struggling debtors do find temporary debt relief through balance transfer credit cards. However, if calculations are done correctly, then it’ll be found that these cards actually drain the funds of the debtors in the long run.

Usually, debtors have to pay a balance transfer fee. Moreover, they have to pay around $495 annual fee together with an introductory rate of around 10 percent on transferred credit card balances. This means people are actually not getting any financial relief in the long run.

3. Initial awesome interest rate later changes into exorbitant rate: Some credit card issuers entice you by offering record low fees for the purchases made in the first 6 months. You may be very happy to pay around 4 percent interest rates during the introductory period. In fact, you should be happy. After all, 4 percent interest rate is a damn good deal. However, once the promotional period ends, you’ve to pay around 18 percent interest rate on the same card. This is nearly 3 percent more than the average interest rate.

It is best to opt for those credit cards which offer 0 percent interest rate for nearly 1 or 1 and half years. Don’t go for a credit card which offers 5 percent interest rate only for 6 months.

4. High interest rates eliminate the possibility of reducing debts: Some credit card issuers/banks milk people who have bad credit. There are thousands of people in the country who are forced to take out credit cards in order to build credit. Banks agree to give cards in exchange of high annual and processing fees. They increase the processing and annual fees with each passing year. Some banks even charge 25 percent fee for increasing the credit limit of the cards.

Credit experts warn consumers against taking out these credit cards. They opine that people with bad credit should always go for the cards with low fees. They have bad credit mainly due to financial problems. As such, they should focus on saving money and increasing credit simultaneously.

Credit experts are of the opinion that people should go for security credit cards instead. Usually, the annual fee on a secured credit card is around $29. In addition to that, people have the option of making a refundable security deposit.

With proper help you can
  • Lower your monthly payments
  • Reduce credit card interest rates
  • Waive late fees
  • Reduce collection calls
  • Avoid bankruptcy
  • Have only one monthly payment
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