SAN JOSE, Calif., June 9, 2020 /PRNewswire/ -- The coronavirus has changed our way of life in many ways. For this article, we'll focus on the financial and credit aspects of life after coronavirus.
For more loan and credit education, visit myFICO's blog at https://www.myfico.com/credit-education/blog
It's more than likely your financial status has changed since the start of the pandemic, and you might be looking for ways to declutter your debt and rebalance your credit habits. Changing the way you handle your finances for the better has two advantages: it allows you to save more money while also giving you more financial resilience – the ability to adapt better to the "new normal." What follows are 4 of the best ways to start changing your credit habits, so saving money and maintaining financial resilience will become an enjoyable habit rather than an inconsistent chore.
1. Monitor your credit card statements for "grey" charges.
So, what are "grey" charges? These are charges that appear on your credit card statement either without your knowledge or due to businesses using dishonest tactics. The most notorious of these: getting a "free trial" for a service and then auto billing starts once the trial is over.
Some examples of other grey charges include:
- Subscriptions you sign up for while completing another purchase
- Getting a service for free (freemium) but not knowing it turned into a paid subscription (premium)
- "Cost Creep" which is when the initial cost for a product or service increases after a certain amount of time without your knowledge.
- Money-Back Guarantees that you neglect. That means you're charged until you return the item or cancel the service
Grey charges cost the average consumer $200 to $300 per month. According to the personal finance security service BillGuard, grey charges cost U.S. credit and debit cardholders $14.3 billion. Don't be one of them. Monitor all your statements and make sure you're not paying for something you don't need or use.
2. Negotiate your discounts.
Many companies were willing to negotiate pricing with consumers before the coronavirus. They are more willing to work with you now – for your sake and to help show the world they care about their customers.
So why not give the utility companies you pay monthly a call to see if they can work with you and give you a break? Or even subscription services like magazines and newspapers. You can also call your credit card company to see if they'll lower your interest rate – at least for a little while.
Here are some of the services you might want to consider calling:
- Mobile phone provider
- Internet provider
- Cable TV provider
- Landline phone provider
- Gas company
- Oil company
- Electric company
- Alarm company
- Life and Auto insurance company
- Homeowner or Renter insurance company
- Credit card company (lower rates)
Take a look at your monthly bills and make some calls. You never know how much you can save with just a few phone calls.
3. Think about your family.
Are there any subscriptions or services you're using that might cost less if you utilize their family plan versus an individual plan? Are you overspending because you haven't had time to do the research? Quite often, the discounts you can get with subscriptions that include the entire family can save you hundreds of dollars a year.
Some of the services you might consider transferring to a family plan could be:
- Mobile phone
- Pandora
- Spotify
- Apple Music
- Google Play Music
- Amazon Prime
- YouTube Premium
Go online and do some research on the streaming (and non-streaming) services you use. Do any of them offer family plans? If so, you might be able to save a lot of money every month!
4. Score some points… real points.
Okay, let's talk about your credit card rewards for a few minutes.
- Are you getting points for every dollar you spend online? COVID-19 has forced us to do a lot more online shopping and receiving points for online shopping can add up to lots of savings.
- Can you redeem your points for cash back on your monthly credit card bill? The more you spend, the more you should get back from your credit card company. Many cards allow you to redeem points toward your credit card bill. It's a nice gift to give yourself at the end of every month.
- Is your current card giving you points for travel or miles points? If yes, think about it. How much travel will you be doing in the near term or long term? Think about changing cards to another that offers points for something you can use right now.
About myFICO
myFICO makes it easy to understand your credit with FICO® Scores, credit reports and alerts from all 3 bureaus. myFICO is the consumer division of FICO– get your FICO Scores from the people that make the FICO Scores. For more information, visit https://www.myfico.com.
SOURCE myFICO
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