Did your credit card get as lit last night as you? Yep – you know the sinking feeling: waking up to amazing memories, and SMS after SMS detailing how you bought everyone and their uncle a drink. Ouch.
First of all, drink some water boo. And take a shower. Then, tackle your credit card debt stat to avoid pesky penalties and interest costs. Start with these tips.
1 Still got your card?
Because you were drunk. If it’s missing, cancel it immediately by calling your bank’s emergency number.
2 Check those receipts
Swipe through your SMSs and note down any unfamiliar charges. Then hop onto internet banking and do the same. According to Cynthia Matshiakgotshi, CEO of Credit Info Academy SA, you should actually be doing this regularly anyway – it’s one of your best tools to fight theft and fraud of your card. ‘Make a list of all transactions (credit card swipes) and check credit card statements regularly to look for unknown transactions,’ advises Matshiakgotshi. ‘Dispute unauthorised transactions with the relevant institutions. If you’re not satisfied with the outcome of the investigation and the bank is at fault, [you can] contact the Banking Ombudsman for free assistance.’
And because you’re still hungover, here are those details right at your fingertips:
Telephone: 011 712 1800
Sharecall: 0860 800 900
3 Prioritise repayments
‘Generally speaking, it’s advisable to pay accounts before the due date and pay off the most expensive debt, like credit card accounts, before saving your money. This is because it is very rare to earn more interest on savings than you will pay on credit card accounts,’ says Matshiakgotshi. ‘I’m not suggesting that you take your life savings and drop it all into repaying your debts, but settling your debts is often the smartest thing you can [do], because it offers the highest potential relief, like saving on interest and improving creditworthiness.’
To avoid accumulating too much interest, try to pay extra monthly installments before the due date.
4 Avoid penalty fees
Steer clear of late-payment charges by setting up debit orders to pay off your card. That way, the minimum monthly payment should be paid monthly, on time, without you having to even think about it. ‘Just make sure that there is always money in your bank account to avoid defaulting,’ adds Matshiakgotshi.
Can’t pay on time?
If you’re unable to pay on time, you need to be honest about it. Here are Matshiakgotshi’s tips for moving forward:
- Inform your creditor, telephonically and in writing, before the due date that you are unable to pay your account on time and to make an arrangement to settle your account. Many creditors will negotiate with you if you’re upfront about your concerns
- Supply your creditor with the reason for not meeting your contractual obligations (including supporting documents if any).
- Avoid making promises you cannot keep.
- For future reference, ask the creditor to acknowledge the repayment arrangement in writing.
- Keep all the communications in a safe place, you might need it in future!
- Make payments regularly as promised.
- Once your financial status has improved, inform your creditor accordingly and start increasing your payments or repaying your debt according to your original agreement.