More and more personal finance bloggers and experts are starting to come aboard the credit card bandwagon.  One of the big reasons is that it is so easy to monitor your transactions now because of sites like Mint.com.  Now that you no longer have to guess about what you spent your money on for the month, or carry every receipt you’ve ever received in your wallet, using cards are – in my opinion – essential.

[youtube]http://www.youtube.com/watch?v=lsSTjjsyPhs[/youtube]

Here are some links to get you pointed in the right direction with cards:

• Optimize Your Monthly Finances: Credit Cards
• Reduce Your Credit Card Interest Rate by Asking
• Credit cards | I Will Teach You To Be Rich
• Using Credit Cards-The Right Way | Personal Finance Corner
• Top Seven Reasons why I use my Credit Card for Everything | Wise Bread

Okay, so your task for today is to call your credit card company, negotiate down your interest rate, and start using them the right way!  Believe me, as long as you use them correctly, there is no smarter way to manage your money.

Credit Card Companies Need You More Than You Need Them

If you are using your credit card the right way (more like cash than like credit), having a lower interest rate shouldn’t matter since you are not incurring any interest.  But you never know when you may have to pay something off in two or more months rather than one.

Let’s get one thing very clear – credit card companies don’t make money unless you use their card (duh).  So they want to retain your loyalty as much as possible.  Have you noticed how much advertising these companies pay for just to get you to use them?  It’s absolutely insane the amount of money they spend trying to make you a cardholder.

Throw Your Weight Around

Because you are the bread and butter of the credit card company’s entire enterprise, leverage their need for your loyalty by getting the rate that you deserve.  It’s not that hard, all you have to do is call them and ask for a lower interest rate.  Here is an example of a successful strategy that I use:

Credit Company: Thank you for calling the Credit Company.  This is John, how may I help you?

Me: Hi John, this is Dean Soto.  How are you today?

CC: I am fine Mr. Soto.  What can I do for you today?

Me:  Well, I recently got your card, and I wanted to use it as my primary means to pay off my bills because I like the reward points I get when I use it. But, I have another card that has a lower interest rate (hopefully this is true, or you will need to go to confession).  Is there any way that I can get the interest rate lowered on my card?

(Credit companies like to know that they are your primary card choice.)

CC: Alright Mr. Soto, let me see if I can help you.

(Typing on the keyboard)

CC: Okay Mr. Soto, we were able to lower the interest rate to <insert percentage here>, does that satisfy you?

Me: Great!  Yes it does, thank you.

(The credit representative will usually try to sell you something else now.  Just decline it.)

CC: Is there anything else that I can help you with?

Me: Nope.  Thank you very much.

It is usually that easy.  They will typically lower your interest to whatever the market interest rate is, or try to beat or match the interest rate on any competitor’s card you may have.

What If They Say No?

I have only had one card company ever refuse to lower my interest rate.  However, they did double my reward points for 90 days.  In addition, after the 90 days were up, I called back to ask if they could lower my interest rate again and they did. I think getting double points and a lower interest rate is quite a success.

Don’t be afraid to call your card company.  You are their customer, and they depend on you for their survival.  They will not lower your interest rate out of the kindness of their heart, you need to prompt them.  The worst they can do is say no, and typically they won’t because they can’t afford to lose a good customer.  So get on the phone right now and get your interest rate lowered!

Part of being productive is getting rid of the barriers that divert you from the significant things that you should be doing. For many of us – especially nowadays – a big hindrance to productivity is money. Rather, it is worrying about money. In this video, I will offer some tips and strategies to optimize your credit card use in order to build a solid monthly financial strategy, or to stop already increasing debt.

Some of the ideas that I present are derived from a great book by Ramit Sethi entitled I Will Teach You To Be Rich.  I highly recommend the book.  No, it is not a scam and it is not a get rich quick book. It is a about money management in the 21st century.

Because credit cards are usually the number one reason why people are in debt, I thought that it would be fitting to start this series of money management posts on how to use them more effectively.   Credit cards are not bad, they are often just badly used.  If implemented correctly, they can actually be a great tool in your financial arsenal.

Here are some of the topics discussed in the video:

• Minimizing cash, and embracing credit cards
• 2 ways to effectively use credit cards
• 5 reasons why using credit cards can save you money

[youtube]http://www.youtube.com/watch?v=XWSGs_n9SJ0[/youtube]

I want to caveat this post.  As Christians, money should be a means of serving God and not an end in itself.  The focus of this article is not to make you rich, but to help present strategies that may alleviate some of the oppression that debt and poor money management can bring.  God’s providence is always present, even in the most dire situations, and should be relied on first above all else.

If you have any questions, criticisms, or tips – please feel free to leave a comment.

Photo by TheTruthAbout