How does your credit card balance compare with the USA's presidential hopeful?

Posted in 'Personal Finance' by Richard Catlin

16 July 2008

The cost of day-to-day living seems to increase on almost a weekly basis – with fuel, food, mortgages and utility bills all heaping misery on the stretched budgets of millions of Britons. No-one can seriously believe the official inflation rate of just 3.8% any more.

As the squeeze hits home, unwanted costs such as interest payments on credit card and store card balances - which for a large number of us are creeping up - could prove crippling. However, a recent report – albeit from across the Atlantic - has highlighted that many of us may well be paying more for credit than we need to.

Laws in the US mean that all presidential candidates are obliged to give disclosure of their debts and assets – and the results serve to highlight just how easy it is to overlook how much interest you might be paying on your credit card.

Republican candidate John McCain’s wife Cindy was revealed to have over $200,000 on personal American Express cards, plus an extra card that was opened for one of their children with a balance of over $15,000 – all at 0% APR.

More telling however was the card that the couple were revealed to hold jointly, with a balance of between $15,000 and $50,000 and an APR of 25.99%. Given his reported personal wealth and likely credit rating (though the two don’t necessarily go hand-in-hand), this is a very high rate, and just like the average person, Mr McCain could probably make big savings just by switching to a cheaper card.

Although some lenders have tightened up their credit scoring criteria in the wake of the credit crunch, others are still lending freely. Some loan lenders are even decreasing their personal loan rates, though these ‘good news’ stories are rarely reported. There are also still some great balance transfer deals available. Capital One’s Balance Transfer Card offers 0% until 1st November 2009 – though you will need a good, or excellent credit rating (4 or 5 star) to get this card. There are plenty of other good balance transfer offers on the market if you don’t have a perfect rating. It’s simply a case of finding the best one.

You can see your credit score for free online, and find lenders who are matched to you based on it – greatly improving your chances of being accepted first time round. We’ve found that the average person can save £400 a year by switching lenders based on their credit rating – click here to see yours now.