The credit card interest rates in the UK have hit record high rates, thereby making the consumers overtly concerned about their personal finances. According to recent figures, the interest rates on small loans as well as the unsecured borrowing costs have remained elevated throughout the month of April, 2011. The interest rate that are charged to people in the UK for borrowing Ł5,000 has increased by 2.3% in April and has reached 15.59%, the biggest monthly hike that has been ever recorded. The present interest rate of the Bank of England is the highest since it has first began collecting the data in 2005. Credit card interest rates in the UK are 16.74% and this is the second-highest rate since early 2003. The latest reports show that the present credit card interest rate is the highest among the last 13 years.

18 credit card companies have increased their interest rates since the beginning of 2011, compared to 4 companies in the same period during 2010. The most famous companies like Halifax, Barclaycard and Santander are all implementing rise in their interest rates, thereby putting the consumers into grave financial trouble. If you’re someone who is trapped in the cycle of outrageously high interest rates on your UK credit cards, you need not fret as there are ways to save your pounds on your cards. Have a look at the various credit card rules that may help you in saving your money and valuing the pounds.

  • Rate shopping is a must: There are many credit card companies that are waiting to offer their cards to you and get you into their business. If you want to save your pounds and value them, you need to make a comprehensive market research on the rates that you can qualify for. Though the credit card companies offer a particular interest rate according to bank’s rates, but yet you can easily negotiate with the creditors and lower the rates. Low interest rates mean convenient monthly payments and therefore make sure that you shop around before settling on a particular card.
  • Don’t miss your credit card bills: Most credit card companies in the UK will charge you abnormally high late fees and penalties for a payment that is even late by a minute or two. If you want to outsmart the crafty credit card providers and save money. You must do the needful to remember your due dates. Reminders on your cell phone may often work. In case of online payments, make sure your payment reaches the company right on time so that they may not be able to charge late fees.
  • Pay more than the minimum amount: You may see the UK banks and financial institutions telling you that making only the minimum monthly payments may just be fine. Don’t believe them as they will try to see their own profits while misleading you. Manage your personal finances so that you can make payments that are more than your scheduled monthly payments so that you may let go of your debt burden and save your pounds on accumulated interest rates.
  • Read the fine print: Financially aware consumers must always read the fine print of the credit cards to avoid any kind of hidden fees that may cast a spell on your finances later. All the information about the introductory rates, the teaser rates will be mentioned in small letters at the back of the card. Don’t miss out this portion before taking out a card.

Use your credit card statements to create a budget so that you may be able to manage your finances properly. Make timely payments and avoid unnecessary finance charges to save your pounds and use it for paying other debt obligations. Avoiding future credit card debt will also become easier by resorting to the above mentioned steps.

Neil Williams is a financial consultant and a writer. He consults people on finance niche. He is a member of the Debtcc community as well. Please join us on twitter.com/debtcc for regualr updates.