iCrowd Newswire
01 Jul 2022, 17:48 GMT+10
It's helpful to know how to use various monetary tools. For instance, you might benefit from utilizing a personal loan calculator or a spreadsheet to keep track of your expenses. However, a credit card might be the most useful tool available because of its versatility.
You may worry about accumulating too much credit card debt in the face of the Fed hiking the interest rate. In this article, we'll talk about what that means. We'll also discuss some ways that you can lower your credit card debt.
The Fed is the Federal Reserve System. It's America's central banking entity, and it was created back in 1913. It allows there to be central control of U.S. monetary systems so that financial crises are less likely.
When the Fed raises interest rates, it does that to combat inflation. Inflation happens when money is not worth as much because the cost of goods and services goes up.
When the Fed increases interest rates, it costs you more to borrow money from lending entities like banks and credit unions. If you use your credit card to pay for many of the goods and services you buy, though, the Fed hiking the interest rate will impact you as well.
That's because, since what you need to buy costs more, you're likely to have higher credit card bills than usual. Let's go over some ways you can lower your credit card debt in the current economic climate.
One way to avoid carrying excess credit card debt and potentially paying interest on it is to pay for as much as possible with cash. For instance, if you pay for groceries or utilities with cash, you don't have to worry about coming up with the money later to cover those credit card charges.
If you pay for services and goods with physical currency, you won't overspend. That's a potential danger when you use credit cards.
Now might be a time to consider debt consolidation if you owe money on multiple credit cards and don't have the funds to pay them off at the end of a single billing period. You can consolidate debt by getting a personal loan from a bank or credit union.
Even with the Fed raising the interest rate, you're still liable to get a lower rate from one of these lending entities than you would from credit card companies. This is usually only an option for you, though, if you have at least a decent credit score.
If you don't feel like debt consolidation is an option for you, you can also pay off your highest-interest credit card debt before you move on to any other cards. Paying off the credit cards with the highest interest rates first makes sound financial sense.
You can also try the snowball method, where you pay off the smallest credit card balances first before moving on to larger ones.
If you're mindful of your spending, you can lower your credit card debt, even now that the Fed has increased interest rates. You can pay for goods and services in cash whenever possible. Doing so means you won't have to worry about paying interest on your cards if you're carrying a balance.
You can pay off the high interest debt on your cards first, or you might pay off the smallest balances before moving on to larger ones. You can also look into debt consolidation if you have multiple outstanding credit card bills. You'll need a high enough credit score for a lending entity to offer you a personal loan with a better interest rate.
By following this formula, you can lower your credit card debt, even with the Fed raising the interest rate.
See Campaign: https://www.credello.com
Name: Carolina DarbellesEmail: [email protected]Job Title: PR Specialist
Tags:CE, Go Media, ReleaseLive, Financial Content, Google News, Reportedtimes, PR-Wirein, IPS, Menafn, Extended Distribution, iCN Internal Distribution, EnglishGet a daily dose of Business Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Business Sun.
More InformationBERN, Switzerland: UBS faces a sweeping new capital requirement from the Swiss government, which this week proposed changes that could...
NEW YORK CITY, New York: At a Walmart Supercenter in New Jersey, buttercream borders and edible-ink cartoons aren't just about sweet...
NEW YORK, New York - Wall Street delivered a split performance on Monday, with the Nasdaq Composite notching up gains while the Dow...
NEW YORK CITY, New York: Luxury group Kering is in exclusive discussions to sell a stake in its prime New York real estate asset on...
CINCINNATI, Ohio: Facing global economic headwinds and mounting tariff pressures, Procter & Gamble announced plans this week to cut...
BERLIN/FRANKFURT: Some car parts factories in Europe have stopped production, and companies like Mercedes-Benz are making backup plans...
BEIJING, China: A little-known office inside China's Ministry of Commerce has become a powerful chokepoint in the global auto and tech...
BEIJING, China: The public security bureau in Guangzhou, a city in China, has announced a secret reward for more than 20 people it...
MENLO PARK, California: As artificial intelligence demands explode, Big Tech is turning to an old source for new power: nuclear energy....
MOUNTAIN VIEW, California: To settle a major shareholder lawsuit, Google is writing a US$500 million check — not for damages, but to...
Russian lawmakers took a major step toward the creation of a Russian super app, passing legislation authorizing the creation of a national...
(250610) -- CUPERTINO, June 10, 2025 (Xinhua) -- People watch the 2025 Apple Worldwide Developers Conference (WWDC25) in Cupertino,...