Credit Card Debt in Retirement The goal of all retirees should be to pay off all consumer and mortgage debts before retirement, including credit card debt. State retirees might elect to continue using credit cards each month for convenience and safety but the wise thing to do is pay off the balance each month. It makes little sense to pay 15-20 percent interest on a credit card balance when savings and investment earnings is probably much less. If you are faced with a credit card balance, shop for the lowest interest rate that meets your credit needs, and consider making adjustments to lower your routine spending patterns and use the savings to pay off the credit card balance.
Did you know that federal consumer credit laws protect retirees? Retirees can and should shop for the best credit deal, plus federal law requires the lending institution disclose the following information to a retiree so that you can compare rates.
In addition, federal law regulates advertising of credit terms, prohibits credit card issuers from sending unrequested cards, limit’s a cardholder’s liability to $50 for unauthorized use of their card, and requires written itemization of the amount borrowed and all charges not included as a part of the finance charge.
Originally published June 6, 2007 |