Women in New Jersey are more likely to pay higher credit card rates than men, according to a new study conducted by the FINRA Foundation. The study revealed that many factors contribute to women paying more, the biggest being financial literacy.
New Jersey Women Faced with Higher Credit Card Rates
It seems that women in New Jersey don’t have the best luck acquiring lower credit card rates, according to the FINRA study. It found that, on average, women pay a half a point higher interest rate on credit cards than men do.
But that’s not the only way that men pay less for credit cards. The study revealed that women are:
- 5 percent more likely to carry a credit card balance
- 4 percent more likely to make only the minimum payment
- 6 percent more likely to be charged a late fee
The downside of carrying a balance and only making the minimum payment is incurring more interest. Since the credit card companies are offering you the convenience of paying your balance at a later date, you have to pay the cost with a tacked on interest charge. Poor management of credit cards can lead to a deterioration of your credit.
Financial Literacy Improves Credit Card Costs
One interesting find in the study was that women typically only pay more than men if they lack financial literacy.
Many people don’t realize that lowering a credit card rates can save hundreds of thousands of dollars over a lifetime, which is why gaining financial education is crucial. Here are a few tips to help improve your credit card use:
- Pay down your debt: The quickest way to eliminate higher interest rates is to pay down your credit card debt each month, since you’re charged interest each month you carry over a balance.
- Pay your balance on time: In order to avoid late penalty fees, be sure to pay your credit card balance on time each month.
- Watch your credit utilization ratio: Your credit utilization ratio is the amount of debt you carry in relation to the amount of credit you have been granted. It’s important to keep your ratio between 10 and 30 percent at all times to show you use your credit regularly and manage it well.
Maintaining credit cards can be a difficult task for women or men, not just in New Jersey but across the nation. By gaining financial literacy, you’re likely to not only lower your credit card rates and eliminate unwanted fees, but also make significant improvements to your credit score.
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