Bank of America just reduced my card’s APR!

Posted on by Richard the MBA

Back in January I shared with you my personal experience with Bank of America throughout my credit journey: https://hiepsfinance.com/2013/01/30/bank-of-america-is-awesome/ . To sum it up, Bank of America has done all the good things for me: gave me a secured card with cashback rewards, unsecured it and eliminated the annual fee a year later, and then raised the credit limit six-fold! 2 days ago I took another step further and asked them to lower my APR of 20.24% typical of secured cards but a little high for a non-secured card.

The representative looked at my profile to see if my account would be eligible for a lower APR. Sure enough, she came back with a new interest rate of 11.99%, the lowest in my current credit card portfolio by a wide margin!

Let me clarify why I asked for a lower APR. I didn’t ask for an APR lowering because I planned to carry a balance; I wanted a low APR in case of emergency when I may have to make a large purchase without sufficient cash. If I had a house struck down by lightning for example, I’d need some cash flow available immediately to start rebuilding, and if I had just paid a large medical bill I probably wouldn’t have the cash at my disposal right away. In that kind of scenario, the BofA card with a relatively reasonable APR would come in handy.

I may give BofA another call in a few months to see if they can bring the APR down to below 10% – that would be the last thing I need from Bank of America for this incredible Cash Rewards card.

BofA BankAmericard Cash Rewards card
BofA BankAmericard Cash Rewards card

I am a loyal customer of Bank of America, at least for their credit card and banking products. If you are still looking for a bank to get your first credit card from, seriously consider BofA.

Hope you have a great weekend!

Best,

Richard (Hiep Tran)

The ideal number of credit cards: why/when more is better

Posted on by Richard the MBA

When I started my credit journey in January 2012, all I wanted at the time was the first card, and I stayed with one card for the next 9 months until I learned that there were better cards in the market. For the next 3 months I went on an app spree and finally came to the point where I felt adding another card to my portfolio wouldn’t do me much good any more.

Apparently the number of credit cards I have is absurdly high to many people. The common perception is that more credit cards suggest more financial trouble. Knowing that a high percentage of the population tend to abuse credit and get themselves into a debt spiral, I totally understand how this perception was created.

Needless to say, if you have had credit before and found yourself often charging credit cards up to the maximum allowed and not paying the balance in full, 1 credit card is enough. You still need a credit card to maintain your credit history, but for that purpose one card can be sufficient if you do not abuse it. On the other hand, if you are able to handle credit well, never charge to the limit, and always pay statement balances in full, then you should have multiple credit cards. If you want to know the reason, please read on.

Continue reading The ideal number of credit cards: why/when more is better

The must-know graph for credit scores

Posted on by Richard the MBA

The chart from FICO, the company that provides the most widely used credit scores, says it all:

ce_scorebreakdown

That is it, folks. To achieve a high FICO credit score, we only need to improve these 5 components. In order of importance, here are the 5 things we should do to increase our FICO scores:

Continue reading The must-know graph for credit scores

Why is your credit card bill so huge: how credit card interest is calculated and what grace period means

Posted on by Richard the MBA

I personally don’t carry a credit card balance unless my credit card is offering a 0% APR promotion because one of my goals in the credit quest is to build a perfect credit history without paying a penny in interest. But from my observation, I’m not the norm. Many people I know carry balances from time to time, and when they come to me for advice, I always tell them to at least pay the minimum to avoid late payment fees, and over time I have helped them save quite a bit of money from that.

Honestly though, paying just the minimum amount is never going to pull you out of debt since credit card interest accumulates everyday at an absurdly high rate. There are many reasons to underestimate interest charges.
Continue reading Why is your credit card bill so huge: how credit card interest is calculated and what grace period means

Today’s feature: Bank of America BankAmericard secured credit card review

Posted on by Richard the MBA

In the credit card universe, Bank of America is perhaps the most underrated. Despite being the 3rd largest credit card issuer in the United States of America, and bearing a really cool name, they are not often known for generous credit card offers. I wish they did a better job promoting their products since some are quite exceptional. One such an example is the BankAmericard Cash Rewards secured credit card.

A real credit card should not have the word "Debit".
It doesn’t say “secured”, but it is a secured card.

Continue reading Today’s feature: Bank of America BankAmericard secured credit card review

Career is the most critical aspect of personal finance

Posted on by Richard the MBA

10-Key-Steps-to-a-Successful-Job-Search1

Recently, I’ve revisited my financial decisions since I graduated from college in the fall of 2011. You know what I found? Having a permanent, decent-paying job actually contributes the most to my assets and financial future. With money in my bank accounts and a stable income stream, I have been approved for good credit cards to build my credit history. The money I’ve saved has been put into my brokerage account so that I can learn how to invest. I’m 24, and I know there are a lot of things to be learned and a lot of money to be earned in the future, but I think I have a decent start, to which my income contributed significantly.

Continue reading Career is the most critical aspect of personal finance

Can international (F-1) students / non-resident aliens (H-1B visa holders) apply for credit cards?

Posted on by Richard the MBA
Yay! I'm an alien!!!
Yay! I’m an alien!!! Cool, huh?

Absolutely! I applied for my Bank of America BankAmericard secured credit card as an H-1B visa holders, and I wish I had obtained my first credit card when I was an international student at Colgate. By the way, to my American readers who may not be well-versed about immigration stati, any foreign citizen that is living in the US is classified by the IRS as an alien. Those like me that don’t have permanent residency either are called non-resident aliens. Someone from the IRS has a good sense of humor.

I know that I asked myself this question at some point while being a college student, and so did many of my friends who were international students. So for the future generations of international students, let’s settle this once and for all. The answer is, again: Yes you can! Continue reading Can international (F-1) students / non-resident aliens (H-1B visa holders) apply for credit cards?

How to access your annual free credit report – step by step instructions

Posted on by Richard the MBA

It is always a good idea to check your credit profile before making a major credit decision such as re-financing a mortgage or applying for a credit card. Sometimes there are errors on your credit report that you need to dispute, and other times there may be legitimate negative records that you may be able to remove in one way or another. Conveniently, the Fair Credit Reporting Act (FCRA) entitles you to one credit report from each consumer reporting agency (CRA). Continue reading How to access your annual free credit report – step by step instructions

Do you need to carry a balance to build credit?

Posted on by Richard the MBA

I often get inspiration for my blog posts from people I interact with. I learn of my readers’ needs through talking with friends, acquaintances, colleagues, and everyone else with whom I have a conversation that involves personal finance matters. In a recent conversation like that, I learned of someone who keeps her credit active by making a large purchase on her credit card and paying the balance gradually, over months, obviously accumulating and paying interests. She learned of this practice from someone else.

You know that I advocate paying off balances before due dates so you’d never pay a penny in interest. Let’s discuss which approach is better for your credit.

Continue reading Do you need to carry a balance to build credit?

Does checking your own credit report affect your credit?

Posted on by Richard the MBA

The other day I was having lunch with co-workers. I don’t remember how this topic came across, but one of my co-workers was convinced that checking your credit would lower your credit score. I just wanted to emphasize that checking your credit is totally harmless. Why?

Continue reading Does checking your own credit report affect your credit?