Source
r/personalfinance•
FelixCopy

Is my credit card randomly decreasing its interest rate?

Credit

Hey guys, just want to make sure I'm reading this right. In my latest statement on my Canadian Tire Financial Services CC, it mentioned this (view image).

This is clearly stating in the future they are planning on decreasing the interest rate to 16.99%? Currently it sits at 19.99%.

If this is true, I'm kicking myself for not accepting the credit limit increase they offered me a year ago. My line is only $500 and I read some bullshit on reddit about keeping your first line of credit's limit low and using it and immediately paying it off to have an extended flawless credit history on your oldest card and never close it. Does this even have merit?

I have an 80% filled CC with a 5k limit. I always thought your total debt/equity mattered for all of your cards, not just each one, and never bothered leaving debt on my other cards for this reason.... Clearly I'm an idiot and am trying to crawl out from this mess.

Posted Jul 17, 2015, 12:37 AM UTC

016
traken•

I'm reading that as them increasing your current rate of 12.99% to 13.99%.

The rate for new applications (19.99%) doesn't really matter.

3
FelixCopyOP•

Figured it out. Didn't realize they just dropped your interest rates like this. I'm going to go check out my other cards now. Is this just bait to get me to use their card? The rate is probably lowered as I never use it except I left $5 on it past due and they appear to have penalized me by 1%.

-1
catfish491•

Actually it looks like it went from 12.99% to 13.99%

2
FelixCopyOP•

Yea.... You're right. I guess because I barely use this card the interest rate has been lowered only for me, without me realizing? I assume if I were to carry over debt on this card they would just fuck around and increase it again? Is this bait to get me to use this card?

-2
catfish491•

Is this bait to get me to use this card?

LOL no, you're a bit paranoid. 13.99% ain't half bad for a store card.

1
FelixCopyOP•

Well I believe it just went up 1% because I missed a very small payment.

-4
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1
wijwijwij•

Even though you might be mistaken about the decrease, I'm still not quite sure why a decrease in a credit card rate is making you kick yourself.

Is it that the card you have $4000 on has an even higher rate? And if you had known the other card was lower, you would have racked up the debt on it instead?

1
FelixCopyOP•

The card I have $4000 on is a 19.99% card. And yes, precisely. I would have increased the limit on the lower % card rather than the higher percent card. But the limit is only $500, so I will likely just leave it empty rather than making that credit history ugly for $250.

-2
aBogleheadWiki Contributor•

If a credit card's interest rate actually matters to you, you're not using it correctly. Always pay off your credit card balances in full, every month. Your interest rate is 0% if you do this.

0
FelixCopyOP•

I currently require debt and there are optimal ways to do so.

-5
scohen158•

Explain? What do you mean require debt? It's not like air to breath no one needs it.

2
FelixCopyOP•

...People need food. Food costs money.

Anyways, I understand I'm speaking with a dumb person. I'll explain a little bit.

I'm setting up my life for success with schooling. It will pay off in the long run. To do well during this time it is in my interest to take on debt. Google student loans for more information on the topic.

There are also many immediately profitable ways to take on debt. But I won't bother going that advanced for you.

-6
scohen158•

Says the guy getting penalized for not paying their bills on time (APR increase). As far as student loans yes typically a necessary evil. However in no world are you better off having to take on debt if you could do the same thing without. However not worth discussing with someone who is at the age of I know everything college student. When you're college grad that can't find a job you'll likely be more humble.

3