Changes to Credit Card Fees & What You Need to Know | Episode 120

Acquania Escarne 0:00

I'm sharing some breaking news today about new changes to credit card fees that you need to know. You are listening to the Purpose of Money podcast, a podcast where we talk about ways to build wealth and create more freedom in your life today. I am your host Acquania Escarne.

Acquania Escarne 0:24

What's up y'all what's going on? Oh, my goodness, we're gonna have to do some things to in real life because y'all I have never gone LIVE before on YouTube. So this is a first. But I'm so glad to be here. And I want to share some news with you guys, because I'm trying to get better about this YouTube thing, you know, like, we are here to get you informed and make sure you have the latest information to make the best money decisions, right? So it's really important to me that we go LIVE from time to time to give you the financial update.

Acquania Escarne 1:03

So I'm sharing some breaking news today about new changes to credit card fees that you need to know. Most importantly, the fact that they're about to go down down to $8. Max, have y'all heard this. So recently, it was announced that the Biden administration in their efforts to get rid of junk fees, those are extra fees that people are paying that they really shouldn't be paying, right, they have successfully gotten federal regulators to max the credit card late fees to $8 per late fee, which is huge, because this is going to save millions for most Americans. Now I know what you're thinking, you're like, Well, wait a minute, why are we gonna pay our credit cards late, and then get a lower fee to do it? Well, the reality is some people forget, right, I had a whole podcast episode about the time I forgot to pay a credit card that I even forgot I had because it was a new card. And I definitely didn't ever really plan to use it. And I had a late fee. And then I had to really work on rebuilding my credit and negotiating with the credit card company to fix the report and pay it off, of course. But as some of you may know, like, legally, you can get one fee waived per year. But if you do this consistently, credit card companies not only rack up on fees, but then they also stop thinking you're the best customer, right? So we definitely don't like fees, and we want to keep them low. But let's get into how this news impacts you.

Acquania Escarne 2:44

Okay, so President Biden's administration, this is part of his goal, he's eliminating credit card fees, resort fees, not completely, but at least lowering them and getting it to a point where it makes sense, right, making it make sense. And so they've done the math, this new change is going to save $10 billion a year for families $10 billion a year. That means your credit card companies when they are collecting those fees, they are collecting 10 billion in revenue. And this also only impacts big companies. So the credit card companies who have at least 1 million accounts. So small credit unions, people like that who bank with organizations who have smaller account sizes will not be impacted by this rule, which means they may still have what we consider the average late fee costs of $32 per late fee. But anyone who is with any of the big providers, you know, discover those credit card memberships AIMEX sapphire, you're gonna see limitations because they definitely have met the criteria.

Acquania Escarne 3:54

The other thing you want to do is know that this is going to help us because there are a lot of Americans in debt right now. And it has been the highest it's ever been in decades. We're tracking at $1.1 trillion dollars in debt. So this will help those who are really using credit cards to make ends meet, be able to at least pay less when they make a mistake. 45 million people are charged late fees on credit cards each year. 45 million people, that is a lot. So if that's you, here's some other tips I have. I like to schedule my bill due date three days in advance of the actual due date on my calendar, and then I set a reminder so I get an alert that reminds me to pay the bill. So if you're someone who's struggling to remember, you know, when all your bills are due and you're not sitting down and consistently paying them on the first or the 15th or somewhere near the date in which you get paid, then definitely utilize your calendar and reminders to remember to pay your credit card bills, or any bill that you have for that matter. That's been something I've been doing for years and it has definitely helped me a lot.

Acquania Escarne 5:12

I also recommend that we budget honey, like let's talk about how much we're going to spend. And if possible, only spend what you can afford to pay off each month. If you are using a credit card to pay for big purchases or pay for things over time. That's totally okay. Just remember to make those payments when you're supposed to, especially if you're taking advantage of 0% interest at the time, or some type of introductory promotion that you signed up for. That's all I have for today. Thank you so much. I'm Acquania Escarne, I'm the creator and founder of the Purpose of Money, a platform that teaches you how to build wealth $1 at a time, and I encourage you to subscribe and follow so that you can get the latest news and information on how to handle your money.

Acquania Escarne 6:01

Thank you for listening to the Purpose of Money podcast. For more resources and information, check out my website, thepurposeofmoney.com and while you're there, please sign up for our newsletter. So you'll have all the latest information on new episodes and blog posts. And so next time keep building generational wealth.

Transcribed by https://otter.ai