One 2009 study by the FINRA Foundation showed that about 41% of credit card holders pay substantial interest payments on their cards. If you’re in this percentage of credit card users, you may want to look at getting your credit card interest rate down.

Luckily, there are several things you can do to lower your credit card interest rate, some of them are surprisingly simple. Here are six tips to help you lower the interest rate on your credit card:

1. Call and ask

One of the simplest ways to lower your credit card interest rate is to ask your bank to knock your rate down. Often times, all it takes is you taking the initiative and asking your bank for a lower rate. If you call the customer service department, especially if you’re armed with information about average interest rates and your excellent credit score, you may be able to get your interest rate lowered on the spot.

If this doesn’t work the first time, keep trying. Sometimes you just need to get through to the right rep on the right day. (If your credit is less than stellar, though, you may need to follow some of these other steps before you call and ask again.)

2. Shop around for a balance transfer card

A credit card balance transfer can be a good way to get lower interest rates, particularly if you’re already carrying a high balance. When you’re shopping around for a card to transfer your balance to, make sure you understand not only your general interest rate and your introductory rate, if there is one, but also the balance transfer rate, which is often different from the overall interest rate for the card. If you aren’t sure exactly how much interest you’ll be paying on a balance transfer, call the card company to find out before you sign up for a new card.

3. Raise your credit score

If you’ve been denied an interest rate reduction and can’t find a good balance transfer card for your needs, you might need to raise your credit score. Credit card companies will rely heavily on your credit score to ensure that you are up to paying off your credit card purchases. If you’re risky, they’ll hike up your interest rate so that they’ll at least be guaranteed to get some money out of you.

By lowering your overall debt, making payments on time, and managing your credit cards well for a few months, you can add points to your credit score, which can deduct interest from your credit cards. Once your score has improved by several points, call your credit card company once more to ask about an interest reduction.

4. Lower your balances

If you’re carrying a very high balance on your credit card, that’s a sign to the credit card company that you may not pay your whole balance. Again, this signals to the company that they should take more in interest so that they can recoup their losses if you were to fail to make payments.

By paying down your balance, you can often negotiate for a lowered interest rate, too. The bonus here is that once your interest rates and your balances are down, you’ll be able to pay down your balance even faster, since a larger portion of each payment will go towards your balance rather than towards interest.

5. Have a good track record

If you’re constantly missing payments or turning them in late, you’ll probably see some serious interest rate hikes. Plus, you’ll take damage to your credit score. If you want a lower interest rate, be a good customer by making your payments on time and avoiding late fees and similar issues. Once you’ve made payments on time consistently for several months in a row, call the credit card company to ask for a lower rate.

6. Avoid scams

The Federal Trade Commission notes that there are many companies out there who will claim to lower your credit card interest rates for you by negotiating with your credit card company or by other means. These fraudulent companies will ask for your credit card information and up-front payment, which then opens you up to credit card fraud.

Lowering your credit card interest rate isn’t that difficult, and you can do it yourself. Never give out your credit card information to a company who claims to have a special relationship with your lending company that would allow them to lower your interest rate for you.

Lowering your credit card’s interest rate isn’t that difficult, as you can see. The goal is to prove that you can be responsible with your credit card, which will make your credit card issuer more likely to lower your rates for your card. Once you’ve shown yourself to be responsible, simply call and ask to have your rates lowered.

Daniela Baker is a personal finance blogger at CreditDonkey, a credit card comparison website.  She is a mother of two and along with her team, she helps families make informed financial decisions about credit.  Visit her blog and remember, you can always compare credit card deals if your current credit card issuer won’t lower your interest rate.

Given that Punxsutawney Phil saw his shadow and we are therefore in for six more weeks of winter, a trip to the islands sure sounds good right about now. Interestingly enough, the same holds true in light of the rate at which consumers are racking up credit card debt.

After beginning 2011 by paying off nearly $33 billion in outstanding credit card bills, U.S. consumers have used the rest of the year to gain it back at a record clip. While the final numbers are not yet in, they are projected to have ended the year owing around $64 billion more than they owed when it began, according to the most recent credit card debt study by the credit card comparison website Card Hub. One of the most efficient ways to pay off credit card debt is called the Island Approach, which involves segmenting your different needs on separate credit cards, almost as if they are stranded on islands.

There are five main benefits to the Island Approach – three related to paying off what you owe and two dealing with how to maximize the free money your credit card gives you once you realize the goal of paying off what you owe.

Paying Down Debt

1. Instills spending discipline: According to the Island Approach, you should have separate credit cards for revolving debt and everyday spending. This allows you to clearly evaluate your spending habits given that an inability to pay your everyday-spending credit card’s balance in full during a given month will clearly signal that you are spending beyond your means and need to cut back. Having built-in “wake up calls” like this helps to ensure that you stop adding new debt, which will, of course, make it much easier to pay down that which already exists.

2. Lowers your average monthly balance: Separating debt from everyday spending also lowers your average monthly balance, which in turn lowers your monthly interest tab. You see, if you have both on the same card, interest will be applied to the total of your debt and daily expenses. On the other hand, if you separate them, your everyday expenses will benefit from a grace period, which means the balance associated with your everyday expenses will not incur any interest. The end result: you save money on a monthly basis.

3. Provides for favorable payment allocation: This approach also helps to ensure that you have no more than one balance on a single credit card and therefore that you benefit from favorable payment allocation. When you have two or more balances on the same card, only the amount of your monthly payment above the minimum required gets applied to the balance with the highest interest rate. In other words, it will take longer to pay down the most expensive debt. On the other hand, if you were to have two balances on two different cards, you could strategically allocate payments in order to make paying off what you owe as painless to your wallet as possible.

Maximizing Free Money

1. Allows you to minimize the cost of interest: The Island Approach is also integral to finding the best credit cards for your needs. Instead of trying to find one that will address all of the different types of transactions you’ll have to make – a futile effort since credit card offers usually only excel in one area – you can focus on getting the best possible feature for a given type of transaction. You see, if you want the best introductory balance transfer rate, you’re not going to find it on the card offering the best rewards.

2. Allows you to maximize rewards: The same obviously holds true for maximizing your rewards potential after you have paid down your debt as well. Instead of finding a single credit card with decent rewards across all purchases, you can get the best possible rewards for each of your biggest expenses. Imagine, for example, that you travel a lot for business and always stay at Hilton hotels, enjoy personal travel as well, and spend a lot on gas and groceries each month. Using the Hilton Credit Card for your business trip reservations, a card like the Blue Cash Everyday from American Express for gas and groceries (3% at supermarkets and 2% on gas), and the Capital One Cash Credit Card for everything else (1.5% across all purchases) would allow you to save the most money possible.

So make like a jet-setter and head to the islands now, and if anyone asks, just tell them that you’re doing it for your wallet. After all, your wallet will thank you.

This article was written by Odysseas Papadimitriou, CEO of Card Hub, a credit card comparison website.

Annual fees… late fees… foreign transaction fees… obviously all credit card fees are annoying, but one of the most despised is the balance transfer fee. Banks reel us in with enticing 0% offers, only to slap us with a big fat fee for using them. What’s up with that?!

So how can you avoid them? Of course the obvious solution would be to have no credit card debt in the first place, but you already hear that from everyone. So let’s skip the scolding and instead focus on the present problem – you’re stuck with debt and you want to transfer it. That’s not a bad idea, but is there any way you can avoid those pesky balance transfer fees while doing so?

It might be possible. Here are 3 strategies I have used.

#1. Use a no balance transfer fee offer

Okay, this first one isn’t exactly that clever, but it’s worth mentioning nonetheless – many people are unaware of the fact that 0% deals with no fees even exist.

All of the major credit card issuers normally tack on a 3-5% fee for balance transfers. The only exception is Capital One; some of their cards have no fees for transfers. Unfortunately, those same cards are usually the ones which are not offering a 0% deal. So you might not pay the transfer fee, but the normal APR would charged afterward (so much for that idea, right?).

However every once in a while, I see a couple 0% offers that involve no transfer fee. Usually they pop up during the first few months each year (probably to target those with holiday hangover debt). For example, the Discover More and Chase Slate Visa card have both been known, on occasion, to have one of the fee-free incentive.

#2. Flat out ask for it to be waived

Did you know at many banks, the CSRs who work in the balance transfer departments actually earn commissions? For this reason, they really are quite interested in doing whatever it takes to seal the deal. Sometimes, that even means waiving the fee on your 0% offer.

Fortunately I have no credit card debt now, but back when I was really poor I had a load of medical bills piled onto cards. From my experience, because the amounts were so high, the bank would be more willing to waive the transfer fee if that’s what it took for me to bite the bait. For example, a couple years ago Bank of America agreed to waive the fee for me since I was requesting a transfer of at least $5,000.

Now I would like to be clear that every bank works different. Some do not pay commissions and therefore, the CSR may be less incentivized to bend over backwards. Also, regardless of how much you hound them, some banks just won’t budge on waiving the fee.

#3. Negotiate for the next best thing

Alright so you tried everything possible to get the bank to budge on the fee, but no dice. That doesn’t mean you should give up. Sometimes you can negotiate various incentives which will help offset – or maybe even outweigh – the cost of the transfer.

For example, your bank may refuse to waive the fee, but what they might be able to do is offer you a cash back/points bonus for spending $X of dollars within a certain period of time. It might be a $75 bonus if you spend $1,000 within the first 3 months. Depending on the size of your transfer, that might offset the cost you are incurring.

And remember, thanks to the credit card reform, your payments now apply to the highest rate balance first. So if you have to spend a certain amount to get the bonus, you won’t be hit with interest on those purchases as long as you pay them in full each billing cycle.

Another sweetener you can aim for is getting them to cap your transfer fee. For example, if the fee is 4% unlimited, see if you can get them to cap it at $50. If you’re doing this with a large amount of money, then having the transfer fee capped should definitely save you some green.

Guest article from Mike of CreditCardForum. He created his site a few years ago while dealing with his own debt (and playing the 0% balance transfer game with it). These days he’s debt-free and focuses on rewards and benefits. His most recent blogpost is about no foreign transaction fee credit cards.

Prepaid debit cards are finding their way into more and more people’s wallets. It’s no surprise to those of us in the financial services industry either because we’ve long known about their ease of use and value. It’s just that now the general public is catching up. Here are 5 reasons why my prepaid debit card can beat your credit card.

Prepaid Debit Cards are Welcome Everywhere

I can’t remember the last time I wasn’t able to use my reloadable debit card in a store or online. These cards are all bank-issued Visa cards and MasterCards and so they’re good wherever Visa and MasterCard are honored. They look exactly like credit cards. You can swipe them in electronic payment devices just like credit cards. And you can use them with a Pin or signature too. They’re good online, in retail stores, and even at ATMs. Prepaid debit cards are definitely not second-class citizens.

No Month-End Bill to Pay

Unlike credit cards, prepaid cards don’t slap you at the end of a monthly cycle with a bill. They’re prepaid after all so you pay up front, thus you’re never surprised at the end of a month with an unexpectedly large bill. There’s a huge conceptual difference between tracking your balance as you spend it down during the month and racking up a balance as you spend. The former is just easier to understand and manage while the latter is vague and difficult to keep under control. Not having a month-end bill to plan for is a real benefit.

Credit Cards Come with Too Many Fees

It used to be that banks and savings & loans made their money off of the interest they charged on their loans. That’s changed dramatically in the last decade or so and now financial institutions make somewhere on the order of half of their earnings on the fees they charge their customers. Credit card fees in particular are rampant. There are so many fees, and so many hidden fees, that many people jump into the preloaded debit card world for that reason alone. Oh there are fees with prepaid cards but they’re small in number and well disclosed so they’re easy to plan for.

Credit Card Interest Rates are Just Too High

Most banks take advantage of incorporating their credit card businesses in states that have high ceilings on interest rates. That allows them to zoom up your rates for a wide variety of reasons. In some cases those rates can even soar into the 29% range. Lots of people find that to be shocking if not outright criminal and so when they discover that prepaid debit cards charge no interest whatsoever, they gladly make the change.

Prepaid Debit Cards Can be loaded via Direct Deposit

One of the knocks on prepaid cards is that you have to keep reloading them to continue to use them. In the past that was a little inconvenient but not anymore. Now you can load up your reloadable debit card by using a direct deposit from your bank account or paycheck. You can even load your card, in some cases, with your PayPal account or other online account. So there doesn’t have to be any interruption with your use of the prepaid card at all.

There are still other ways that a prepaid debit card can outshine a credit card but that’s a topic for another discussion. The fact of the matter is, prepaid debit cards wouldn’t have gained so much ground on credit cards in the last few years if they didn’t have some very strong features and benefits going for them. If you haven’t already, take a little time and do a little more research into prepaid cards. Or better yet, pick one up at your local drug or convenience store and give it a test spin. You’ll learn first-hand what great payment tools they are.

Do you use a prepaid credit card?  Feel free to share your thoughts, comments, questions, and tips at the end of this article.

This article was recently featured in the Carinival of Personal Finance by Sweating The Big Stuff.

Our less than stellar economy isn’t doing college students — already stretched thin by huge tuition bills, expensive books, and beer — any favors. However, if you have to spend why not get a rewards credit card?

Whether you’re looking for your first card, or are already working the plastic, picking the right rewards card maximizes returns for all your expenses. The list below outlines how to protect yourself from getting scammed when picking a rewards credit card.

1. Rewards Points or Cash Back: What’s Your Fancy?

Are you looking for points in the form of gift cards and merchandise or do you want money accredited back to your account? This decision is solely preferential but, depending on your spending habits, certain combinations maximize return. Below are some facts about the three major types of rewards plans:

•  Cash Back: In general credit card companies offer 1-3% cash back on all purchase. However, many offer larger percentages with select merchants. If you can buy a product you need from a sponsored location why not capitalize on additional cash back?
• Air Miles: using ones card for airline miles is very smart, as well as popular. Maximizing your miles is a combination of knowing thy flying habits and consolidating spending. If you have a go to airline be smart and select a card which is sponsored by that airline. You’ll be able to capitalize on additional miles over the standard one dollar spent equals one mile. Finally in order to really rack up those miles charge all expenses to the one card then pay it off at the end of each month.
• Points: If you’re really looking to capitalize on your rewards cards points are probably the best means. Distinguishing and identifying the best points program is tricky though and involves some thorough research. I’d first pick a handful of cards you are interested in based on APR and credit score then dive into each cards specific program. A few hours or research can lead to a life time of savings!

2. APR and Fees: Keep Your Money Away from the Credit Card Companies!

 For those getting their first card, the Annual Percentage Rate (APR) is a yearly interest that includes fees and costs associated with card usage. APRs range from 10-22% depending on the company. Basically, the lowest APR is the best APR. Fortunately, credit card companies like to get students in on the game early, so they offer low APRs.

Here’s an example: Suppose you buy a shinny new MacBook Pro for $1,200 on a card with an APR of 15%. If you don’t pay the bill within the contractual time frame, you could pay $1,380 in total i.e. $180 down the drain!

Almost every card is also going to charge you a late or returned payment fee, which typically costs  “up to $35.” Also, watch out for penalty APRs, which are trigger by small infractions like  late payments. These penalties are astronomical and range from 20 to 35%.

3. The Key to Credit Cards: Pay Your Bill on Time.

I know you’ve heard it a thousand times, but notice that all the fees and penalties above revolve around you not paying your bill on time. Don’t let the credit card companies win, be disciplined. I’ll say it again for emphasis: Pay your bills on time!

4. Three Outstanding Credit Cards for College Students.

Base on the above information, I’ve selected a combination of both cash back and rewards cards for your consideration. But, research all your options, in depth, to ensure you get a card that is best for you.

Byline: Post written by Kyle Espinola of FindTheBest.com, an unbiased, data-driven comparison engine designed to help you find the best savings account, car, credit unions, and much more!