Want To Lower Your Citi Card Interest Rate? You Must Spend More Money With It

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Are you a Citibank credit card member?

I am and have been since 1998. The card I currently have is the Citi PremierPass card which I got in 2007. Though I own the card, I don’t use it very often because the rewards from the card isn’t better than those I receive from other cards. Basically, I can get 2% cash back, in the form of ThankYou Points, for every dollar spent at gas stations, grocery stores, and drug stores, plus 1% anywhere else. It’s still a decent rewards program (the card is offering 20,000 bonus points for new accounts), but I get better rebates by a combination of a few cards. For example, when filling up my car or shopping at grocery stores , I use Chase Freedom Card to get 2% cash back; when eating out at restaurants, AmEx TrueEarnings Card is my first choice sine I can get 3% rebates, if AmEx is acceptable. For everything else, I just use Fidelity 529 College Rewards Card to get 2% rewards. While I would love to use a single card for every purchase, it’s unfortunate that there’s no a one-card solution that gets the most out of the money spent. Thus, I have to take the multi-card approach.

Anyway, credit card rebate isn’t what I want to talk about here. The topic today is about a recent announcement from Citibank about its credit card usage and interest rate policy. According to an article on MSNBC, the only way for Citi cardholders to avoid the current round of interest rate hike is to meet the monthly spending requirement, as much as $750/month in some cases, imposed by the nation’s second largest credit card issuers. However, it’s not that you can avoid the rate increase all together even if you charge the required amount on your cards every month. The rate still goes up. What you get is the rebate of the portion of the financial charge on your balance due to the rate increase.

Well, it looks just like another way the credit card company tries to make its interest rate hike look nicer when it is still allowed to do so. I doubt how much it can ease the burden on cardholders who carry balance on their cards because to get the rebate, you will need to spend $750 every month, and the more you spend, the more interests you need to pay and if you can only manage to pay the minimum every month, the deeper you will be in the hole if you are trying to pay off your credit card debt.

The best way to deal with credit card interest rate is, in my opinion, not to have any credit card debt at all. If you pay your monthly bill in full each and every month, how the card issuers manipulate rates and terms won’t matter too much to you.

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    • Chitika