Do you have credit card balances with payment protectors? Here’s a tip for you to reduce your balance by taking advantage of your payment protection plan.
Some payment protection companies allow you to utilize an emergency payment once per calendar year. Depending on your credit card’s plan, it may just allow you to skip a monthly payment. Others will actually make your minimum payment for you. Capital One’s plan is like this.
Normally I recommend against payment protection plans, because it’s just over priced insurance. If you have balances, then the amount you end up paying for interest and the payment protector is basically double what you would pay in interest alone.
If, by chance you do have a payment protection plan and a balance on a credit card, then now is the time to use that emergency payment. Then you’ll also be able to use it in January. After that, cancel the plan all together.
When you invoke the plan, make sure to plan on making your regularly scheduled payment so that you can knock some more principal down.
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