Are you drowning in credit card debt like I am? Have you called asking for a better interest rate? I don’t know why I held out this long in phoning other then I was fearing them asking me my current salary to be told they couldn’t do anything because I wasn’t working.

On Wednesday, I finally phoned three of my credit card companies to ask if they could give me a better interest rate. I had heard from various places that the banks are currently itching for business and now was a good time to call. In two calls, I had one card drop 7% interest and another dropped 5% for a total of 12% less in interest I’ll be further buried under each month.

A third I called and asked but they claimed that 11.5% was the lowest interest rate and right now I have some deal on 2.9% on cash advances until the end of October. I don’t believe her because of how wavering her voice was and the insistence that I had a great rate with the 2.9%. I will call RBC back in November and see what they have to say knowing full well that many credit card rates I can get at 9.99% or less right now.

You might be wondering how I got the interest rate lowered. I simply phoned and when they ask “How can I help you today Jacob?”, I said, “Can you give me a better interest rate?”

MBNA Canada offered a 5% reduction without any resistance while telling me that I could call back in a few months and they might be able to reduce it up to another 5%. That and of course that they could raise the rate again at any point if my account was in arrears. I fully plan on calling them back in another 3-6 months to see if they will further reduce my interest. CIBC I was able to switch over to a card I used to have at a rate of 11.5% without any problems.

I have been keeping an eye out lately for lower interest credit cards or Visa/MC cheques that I could transfer balances to not be charged so much in interest every month. There are people that do this in an effort to pay as little interest a month as possible. Now, the trick isn’t to just keep transferring balances around, but to transfer the balances to lower interest rate credit cards while making double or triple or more payments on whichever of your debt has the highest interest rate.

Most people don’t realize that the minimum payment they ask you for each month, only pays the interest charge for the month and a small portion of what you owe on the card. I have unfortunately been buried in debt since I graduated from college and still shoveling to get out going on nine years later. I think the extra amount of money I make a month over a much lower paying job just goes onto the debt incurred to obtain that education/career and makes me wonder if it was even worth it – but that’s a post for another day.

Morale of the story is – don’t borrow money you don’t have, pay off your credit cards at the end of each month, if you can, work while going to school to pay for it and only take as much as you need of the student loan money they offer instead of drinking the rest away!