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Credit card finance fees, do you budget them

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  • #1

    Credit card finance fees, do you budget them

    I am budgeting all expenses, no matter if I pay with the debit or one of my credit cards. So all my purchases get covered, I can pay at the end of the month and my debt doesn't increase.

    But it does, One credit card alone has a finance fee of 24.75.
    I think that while I work to pay it off I need to include that on my debt budget....makes sense?
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  • #2
    Why is there a finance fee if you are paying it off each month?

    If you are carrying a balance, then yes, you should include any interest fees in your budget.
    Steve

    * Despite the high cost of living, it remains very popular.
    * Why should I pay for my daughter's education when she already knows everything?
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    • #3
      Sorry, yes I do carry a balance, I have two credit cards with balances and one unsecured personal loan.

      My first objective was to stop using them so the balance would stop growing, from there I want to pay them off.

      When I allocated money to pay debt I included only minimum payments.
      Now I realize it should be at least minimum payments + any new charges + any financial fees.

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      • #4
        I would suggest ONLY using cash or a debit card for NEW purchases.

        Do you have a credit card with a $0 balance? If so, you can use ONLY that card for NEW purchases and make sure to pay off the balance in FULL each and every month.

        I would consider either opening another small limit credit card or transferring the balance of one credit card entirely to the other (assuming same or lower interest) in order to save on interest. $24.75/month is $24.75 too much IMO.

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        • #5
          hmm, I guess I can do that.
          You mean apply for a new card and get balances trasferred to it?

          I really didn't want more cards.. is it worth the hassle? well, I guess I tis worth almost 50/month since I have 2 cards like that....

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          • #6
            Originally posted by Radiance View Post
            hmm, I guess I can do that.
            You mean apply for a new card and get balances trasferred to it?

            I really didn't want more cards.. is it worth the hassle? well, I guess I tis worth almost 50/month since I have 2 cards like that....
            No I mean:

            1 - Just get a new card for the sole purpose of making NEW purchases on and it MUST be paid off in full every month. Do NOT make any new charges on the cards with balances on them. You will be socked with interest the DAY you make the new charge. Don't make any charges that can not be paid in full every month. Otherwise, you will have opened up new credit and charged it up with more debt.

            OR

            2 - Transfer the entire balance of ONE of your existing credit cards to another card you ALREADY have to "free" it up to make the interest free charges.

            Bottom line is that when you make charges on a credit card that was paid in full and have no balance on it and pay it off in full before the due date, you pay 0 interest. If you make a charge on a card that carries a balance you pay $$$$ in interest that accrues the every day you make the charge.
            Last edited by graceful; 07-24-2009, 01:22 PM.

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            • #7
              If you make a charge on a card that carries a balance you pay $$$$ in interest that accrues the every day you make the charge.
              I didn't know that! I thought it was calculated monthly.

              Now I get it! Thanks

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