You’re probably already familiar with the term “interest charge.”

But not so much with jargon like APR, balance transfer, cash advance, and returned check fee.

Not to worry – we’ll decipher these terms for you in plain English and with minimal jargon.

Starting with…

APR.

What is APR?

APR, or annual percentage rate, is the rate of interest that is charged on a loan for a whole year.

In this case, by using your credit card, you borrowed money from your bank that you now owe. 

How this rate is calculated depends on the U.S. Prime Rate, which, according to Bankrate, is the interest rate at which banks will lend money to their most-favored consumers. Your APR can vary based on your credit worthiness, and we at Harvest Platform suggest that you try to periodically ask for a reduction in your APR.  

To calculate how much you owe in interest on a credit card bill for a specific month (this amount will only be charged if you don’t pay off your full balance before the end of the statement period) , use this formula:

For example, let’s say your card has an APR of 20% and your statement balance is $1000.

How much do you owe this month in interest?

The number 20 is the APR.

Dividing by 100 gives the APR figure in decimal terms.

Dividing by 12 then gives the APR figure in monthly terms.

1000 is your starting statement balance. 

Monthly payment = (20/100)/12 * 1000 = 16.67

On a monthly basis, you owe $16.67.

What is a Balance Transfer?

A balance transfer allows you to move credit card debt from one card to another. With Wells Fargo, cards that allow for balance transfers include:

• The Wells Fargo Platinum Card
• The Wells Fargo Cash Wise Visa Card
• The Wells Fargo Rewards Cards

Reasons for doing this include:

• Benefiting off a lower interest rate on another card, which means lower monthly payments.
•  Needing to make only one payment instead of multiple payments, which can be a time-saver and reduce the possibility of late fees.

What is a Cash Advance?

A quick way (but inadvisable given how costly it can be) to get cash using your credit card at an ATM. Only works for credit cards with ATM fees.

Most Wells Fargo credit cards, such as the Platinum Card and Cash Wise Visa Card, permits cash advances. Each cash advance costs either $10 or 5% of the amount taken out, the amount charged being the greater of the two. 

What is a Returned Check Fee?

A returned check fee is charged when the check you send for a credit card payment is invalid and then returned to you. Wells Fargo charges $37 for a returned check.

And now, a term that needs no definition and is a familiar foe to all who have been late on their credit card payments:

The late fee.

With Wells Fargo, that late fee is $37 for every late payment, which can make even the most honest of oversights an expensive mistake.

But enough about what fees there are. 

Let’s discuss how to avoid late fees.

How to Avoid Late Fees

The simple answer is to make at least the minimum payment towards your credit card statement balance every month.

How, you ask?

With credit card holders in general, failure to make payment usually comes down to two reasons.

•  A lack of funds in your account.
• Forgetting to make that payment.

If you lack funds, you can obviously try to either increase your income or adjust your budget so that you have more left over to make that minimum payment. If you’re dead set on making a payment that is higher than your minimum, try to examine your spending decisions to see if there is any excess that might be contributing to a higher than is affordable statement balance.

If forgetfulness is what causes you late fees, you can look into auto-pay options.

If auto-pay isn’t an option due to, say, income fluctuations, look into setting up a personal plan to strategically pay off your balance based on your income.

For example, and this is just a basic example, let’s say you get paid weekly, and your income fluctuates between $300-500. You have a credit card statement balance of $1000 that needs paying off due to the interest you’ve been racking up. Instead of kicking the can down the road, you can divide up that $1000 into 20 pieces of $50, and focus, in the next 20 months, on paying off that $1000, $50 at a time (+ your interest payment)? Assuming you have an APR of 20%, your monthly payment is $16.67 (which progressively goes down as you pay off your statement balance).

Here’s a better visualization of the above example:

And so on.

When you’re paying off a large chunk of credit card debt (large being a relative measure), try to use a different credit card and don’t use the credit card with the debt on it until it’s fully paid off.

That way, you’ll be able to see concrete progress throughout the whole process of paying off your bill.

Alright, all that’s useful for avoiding future late fees but it seems like I’ve racked up a lot of late fees and interest charges.

How do I get past late fees and interest charges back?

Ah, the good part.

Fee and interest charge refunds.

Call your bank.

Ask nicely for a refund on your late fees.

Not a fan of calling your bank?

Use us instead (we’re nice).

Sending us a message on Facebook or through our website also works.

We can help negotiate those pesky interest charges and late fees back on your behalf.

You won’t have to say a single word to Wells Fargo.

Once you sign up, we’ll do the work.

So you can get on with your life.