Staying away from credit card debt

As many Canadians continue to charge their credit cards, they are increasing their debt loads at an alarming rate. Getting into debt can happen very quickly, getting out of it is not so easy. Below are some tips for avoiding getting into serious credit card debt.

1. Do not apply for too much credit. Limit the amount of cards you apply for and have to two.
2. Use your card sparingly, for purchases such as gas and groceries.
3. Only charge amounts on your card that you know you can pay back before your next credit card billing date. Do this to avoid paying interest charges.
4. Choose a low-interest credit card over a rewards or points credit card if you intend on carrying a balance. Rewards cards are nice, but often come with higher interest rates.
5. Do not use your card for frivolous, spur of the moment purchases. Using your credit card for an expensive pair of shoes you might never wear is a waste of money. Always plan your purchases.
6. File your credit card receipts for 3-5 months. After the fifth month, look back at your purchases and see which ones you could have avoided. You might be surprised to find that some or many of your purchases did not have to be done by credit. This will prompt you to think about future purchases.
7. Leave your credit card at home if you are going somewhere you know you will be tempted.
8. Credit card companies periodically increase the credit limits of their customers. If this has happened to you, call your credit card company and request your limit to be decreased. This will keep your debt load low.
9. Shred your credit card receipts instead of throwing them away to avoid identity theft.
10. Notify your credit card company of any unauthorized purchases or any discrepancies.
    

Canadian Tire Money

I was at Canadian Tire the other day, and bought almost $100 in merchandise. I only received $0.05 back in Canadian Tire money. I thought the cashier had made a mistake and made a mental note to call Canadian Tire when I reached home. I spoke with customer service who informed me that when paying with a credit card at Canadian Tire, you get almost nothing back in their "money". Only paying by cash earns you big Canadian Tire "bucks". Good to know.

Happy Shopping!!

Credit Card @ the Pumps

I had approx. $140 left on my MasterCard, when I bought $15.02 gas at a local gas station (Petro Canada.) On my way home, I decided to use my card to pay for some groceries, much to my surprise, the card was declined. This was strange, as I was certain I had about $120 left after my gas payment. Fearing that some fraudulent activity had taken place, I called the credit card company and was told that there was a hold on my account for $120 from Petro Canada. What had happened was that in paying at the pump, a hold was put on my account by Petro Canada as a means of ensuring that payment went through. This hold is anywhere from two to four days. I called them (PetroCan) and asked why a note or bulletin was not posted at the pumps, where patrons would easily find it. No real explanation or answer was given (as there never is).

I was finally told after being flipped back and forth from credit card company to gas company and back again, (after trying to have this hold taken off) that when paying by credit card at the pumps, the transaction is not handled the same as when payment is made with the cashier. For whatever reason, a hold is placed on credit cards and debit cards when a payment is made at the pumps. This, however, is not the case with payments that are made with the cashier inside, as the transaction is instantaneous and the amount paid for is all that is taken out of the account. The credit card company was informative, as they told me that all Canadian gas companies do this and the amounts held vary from $99(Pioneer) to $150(Sunoco) and everything in between, depending on the gas company. Gas companies in the US will hold as little as $1. If you only have enough funds on your credit card to cover the gas payment, your card will be declined and it would be in your best interest to pay inside.

In the case of debit cards, they ensure that the amount held is in the account. In my situation, if I only had $15.02 in my account, the transaction would not have gone through, and the machine would have told me I had insufficient funds. The same transaction would go through no problem, had I paid with the cashier.

Do yourself a favour, take a few minutes and walk in to pay for your gas purchases with the cashier.

You wouldn't want to go on that dinner date, only to find out, when the bill comes, that your card has been declined. Imagine the embarrassment.

Happy Shopping!!!!