How to lower your effective interest rate on your credit cards
Save money and become debt-free faster.
- Credit card debt could cost you much more you than originally borrowed
- High interest payments often don't make it feasible to invest or save for retirement early on
- Exploring avenues to lower effective interest rates could shorten your debt repayment journey and save you thousands of dollars
Getting stuck in the vicious cycle of credit card debt can be a life-draining experience, especially when your outstanding balance is in thousands of dollars and you continue to pay monthly minimum payments. Your credit card repayments against high interest rates subject to your outstanding balance mean you end up paying much more than you borrowed. This could make it longer for you to become debt-free.
An average American household has over $5,000 in credit card debt where the average credit card interest stands at 20 percent. At a time when households are undergoing an uneven financial recovery during the pandemic, losing a significant amount of money every month towards debt could delay your retirement savings and rainy day funds.
While prioritizing high-interest credit cards with larger balances could help to some extent, being able to lower the effective interest rate on all of your credit cards would be a real win. Fortunately, an AI-powered app called Tally offers a simple yet effective way to do just that.
Not only does the lightweight app help you create a personalized debt repayment plan with a projected debt-free date, but it also goes a step further to offer a low-interest line of credit starting at 7.9 percent to help you save money.
After downloading theTally app, you will have the option to avail of a low-interest line of credit if you have a credit score above 660. If you accept it, Tally will transfer all of your credit card balances to your new line of credit and pay your creditors every month on your behalf. It basically converts all of your credit cards into one and you will only have to pay Tally one consolidated bill each month at a lower interest rate. This will help you save money on exorbitant interests immediately from your next billing cycle.
Based on Tally’s calculations, users could save up to $4,185 in 5 years. Since missed credit card payments could invite steep late payment charges and open up a scope of negative credit impact, Tally’s Late Fees Protection program ensures that if you miss a deadline, they will automatically pay on your behalf. You can then pay Tally at a later date. We recommend that you stay current on your accounts to keep availing of this feature.
To start saving, simply download the app and link your credit cards through their 256-bit encrypted platform. From there, you will get access to a personalized debt repayment plan powered by artificial intelligence to help you become debt-free as soon as possible.