Save Money: Make the Call II

I’ve written about saving money with a telephone call and it is time to do it again; this time I’m calling credit card companies for a reduced interest rate. Tackle your credit card interest rates routinely! It will make a difference.

I’ve called the partner’s credit card companies at least 3 times in the past year. I usually wait a couple months and try again to get a lower rate. With found money on the horizon, we’re planning to pay down debt and want to pay off the higher interest rates first.*

In March I called and got the following results:
Card #1 – 17.24% reduced to 12.49% (variable)
Card #2 – 18.45% reduced to 9.97% (variable)
Card #3 – 17.99% reduced to 13.99% (fixed)
Card #4 – 18.47% was increasing to 23.24% and they refused to budge.

Yesterday the rates were:
Card #1 – 13.24% (variable)
Card #2 – 10.82% (variable)
Card #3 – 13.99% (fixed)
Card #4 – 24.24% (fixed)

Clearly, variable rates tend to vary upwards. I choose to take the variable rates because I have the discipline to call and get it reduced when it starts inching upwards. If you don’t want to take the time to make the call, the slightly higher fixed rate may be your better option.

Today I repeated my calls to two of the cards. I’ve been very frustrated with #4 because they have refused to reduce their rate the last two times I’ve called. I gave them a final chance today and they finally responded.

Today’s results:
Card #3 – 13.99% reduced to 12.99%
Card #4 – 24.24% reduced to 8.74%

As you can see, Card #4 did not want to lose our business. The partner has had most of these cards to 10+ years and has always paid on time and has excellent credit. So, the ultimatum strategy finally worked. However, I feel that the strategy worked because we’ve paid $7000+ toward this card since the beginning of the year. It is actually our lowest balance card and the one with the most aggressive payments.

I haven’t decided if I’m going to call card #1 again or not. I got a good reduction in March and turned down in June or July when I tried again. I will call card #2 if I have the time but I am not going to stress over it right now.

So, next plan of action is to decide what to do about the upcoming found money. I’m thinking that throwing it at the highest rate and then possible transferring the balance to another card with a 0% rate for 6 months and a 3.96% fixed after 6 months. I’ve never done a balance transfer and that’s content for another post.

Important: Make the call! It is not complicated and the worst they can say is No, the best they can do is reduce your interest rate by 64% (see above) or more!

* In response to the higher interest rates/smallest balance debate – we hate to throw away money and that is what we are doing when we carry high interest rates. Many people argue that paying off the smaller balances first adds encouragement and makes peole stay motivated to reduce debt. We don’t need the motivation, we’ve got it, and we’re gonna make every penny count.

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