The interest rate
According to the ABC, 73% of Canadians repay the entire balance of their credit card each month. This is our case? You can ignore the interest rate - 9.9% or 28.8% - and choose our map depending on our preferences and the benefits it offers. If, on the other hand, it often leaves a balance on our map, was well advised to opt for a reduced interest, i.e. by 9.9% to 14.5% rate. The downside? These "cheaper" cards are often accompanied by annual fee. To find out if they are for us, "Comparing the amount of interest paid to the card annual fee", says Johanne Arnould, budget Advisor to the Association Cooperative of economies familiale (ACEF) North of Montreal. Cheaper, they will pay a balance of $500 with a card that has annual fees of $25 and an interest rate of 12% with a no-fee card, but a 19% interest rate. At the end of the year, the economy reached even $445!The credit limit
A $5,000 credit limit, it is tempting! But is it for us? Find out estimated our revenues and our spending - omitting the savings! This lets us know how much you can borrow and repay each month.Having good credit limit is all the more important that, if it is too high, this is detrimental to our credit rating. Indeed, "the lenders consider to borrow this amount at any time", said Liane Chacra, financial planner at Investors Group. In other words, a credit limit is considered to be a potential debt. Result, "the Bank could deny you a loan to buy a car or grant you it to a higher interest rate," said Ms. Chacra.
Therefore, it does not rely in the credit limits that we offer financial institutions. "Because, to provide a higher limit, they look only if it reimburses the minimum required each month, even if it is able to resolve all of our balance", says Johanne Arnould.
