Could talking about your debt improve your situation?

June 26, 2007

When it comes to withdrawing money from an ATM, usually we do it with debit cards. The whole point of a credit card is to have money when you wouldn’t normally have it and you do not even have to look at it which makes spending on the card a lot easier. However, there are some consumers who do like to withdraw money from their credit cards and the trouble is, it comes with an exceptionally large interest rate.

Many consumers are charged just over 23% for withdrawing money from their credit cards and that figure is constantly on the rise. That is just the average too; some consumers are unlucky enough to have to pay over 40% interest on their cash withdrawals. So drawing money out can prove to actually be quite expensive.

It is thought from new studies that roughly around £750 million is spent every single month by people in the UK on cash withdrawals from their credit cards. When you look at that figure you will realize just how much profit credit card companies are making from consumers. You do not often realise just how high the fees are going to be but generally they are really terrible.

Even if you do pay off the full balance at the end of the month you are still usually paying more than you would for withdrawing cash from a debit card. This is because many credit card companies charge their consumers around 3% just for the withdrawal of the money. So it is always better to stick to a debit card withdrawal than a credit card one.

However whilst most credit card companies do charge exceptionally high fees for withdrawing from their credit cards, not all companies are the same. Some such as Egg Money, the Co-Operative Bank and Abbey do not charge such high fees for at least one of their cards. It is all about shopping around to get the best deal for you.