Last year, I automated my credit card payments to be deducted every month by careonecredit without me having to do anything. I would just look in my bank account and see the money gone every 5th of the month. Many months passed and when I assumed that my many automatic payments had taken a big chunk from my initial balance, I was nearly floored to see that the original balance had barely budged.
How the heck is my balance not going down?
What is going on?
It turns out that my APR had increased significantly and my payments were now barely covering the new finance charges. What the hell? I had chosen paperless statements (to save the environment) and probably one of the emails I received from my credit card company had detailed the whole scalping process. I most likely deleted it of course without opening it. It’s junk mail clutter as far as I am concerned.
More sneakiness
Recently, many credit card companies also lowered available balances even for accounts that were current and had no recent delinquencies. Once again, the details escaped me, either through the shredding process or through junk mail. Since the ratio of debt to available balance is used to calculate credit score, mine took a sizable hit.
Keep on top of things
The lesson to learn here is that while it is a very good idea to set your finances on autopilot, it does not mean that you can totally disregard all forms of communications from your credit card companies. Trust me: opening regular mail or email from them can save you a lot of money. Or in my case, make sure that your money is actually doing what it is supposed to be doing.
Have your credit card companies done anything recently to cost you money? How have your experiences with them been?
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