Here are a few secrets that the card companies try to keep to themselves:

1. Minimum Payments - If you only make the minimum payment appearing on your credit card statement, then on an average balance of $4,000 each month, it will take you over 40 years to repay the balance. It means there is no real time set down for you to pay the debt back.

   It?s an open-ended type system and it is in the interest of your credit card company to let you pay only the minimum amount, because they get high interest on the outstanding amount month by month.

   It is in their interest that you are in debt, because this is their business. Once you pay back your debt, they no longer have an income. Most credit card companies will let you pay off your credit card balance forever if you let them.

   In fact, a lot of credit card companies do not like you to have your credit card at a nil balance from month to month because it slashes their income considerably.

2. Just Keeps Going - When you take out a normal loan it is usually for a particular term and therefore your repayments are geared to clear the loan by the end of the term. With credit cards however, there is no fixed term and therefore there is no end set down. Someone said it?s like the energizer bunny seen on TV that just keeps going, and going and going and going.
3. Teaser rates - Credit card companies usually have what is known as a ?teaser rate?. This is a low rate, which encourages you to take out a card. After a period, (usually 6 months) it?s bumped up to a very high rate. This introductory credit card rate is heavily advertised, but what you don?t see is the fine print.

   The fine print (which is so small that you need a magnifying glass to read it) clearly sets out the conditions, and one of these is that the rate will increase. Be careful, because like any other offer or business opportunity put before you ? if it sounds too good to be true, it generally is.

4. Before Due Date - Remember that credit card payments are due mostly on the last day of the month or on the first day of the next month, or on the date shown on the credit card statement. You must ensure your payment reaches them before that due date or you will be hit with a late charge. What also happens is that you will be charged interest on the entire balance from the time the balance was debited on to your credit card account.

   It is very difficult for you to win with your credit card in this type of scenario. The moral is to make sure you pay your credit card off so there is a nil balance each month and if you cannot afford to do that, then always pay the minimum amount and pay it by the due date.

5. Watch Promotions - You need to watch promotions where credit card companies offer you incentives to transfer your credit card balance to their card. They usually entice you with a lower rate of interest and it really sounds like a generous offer. However, just check that there are no catches.

   With some cards, if you don?t charge something new on the new card each month, the interest jumps up to the regular rate for that credit card, which is usually very high. If you make a late payment, the promotional rate disappears and you will be hit with the regular high rate. You have to carefully check out what?s in the offer, and if necessary ask questions before you accept the proposal put before you, however attractive.

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