1.Consolidate debt. With interest rates at historic lows, it makes sense to
debt into one low-interest loan. For example, if you have outstanding balances
on several credit cards, consider transferring those balances to one credit card
with the lowest interest rate. If you qualify, it may be a good time to apply
for a home equity line of credit to consolidate debt or make a home improvement.
Banks have been easing lending standards, so it may be easier to qualify today
than it was a couple years ago.
2.Shop around for credit cards with the best interest rates. You may be able to
get one with better terms than the one you are currently using. Or, ask your
credit card issuer to lower your interest rate to make it more competitive.
3.Make large purchases now. If you've been thinking of making a major purchase
like a house or a car, today's low interest rates make it a good time to finance
big-ticket items. However, make sure you have a good credit record and can pay
the loan before applying.
4.Know your credit score. Before you apply for any loan or credit card, check
your credit report and learn your credit score. Make sure your score is higher
than about 680 to qualify for the very best rates. If your score is lower than
that, pay down your balances, remove errors from your credit report, and pay bills
on time to raise your score.
5.Keep saving. Just because standard savings accounts aren't paying a lot of interest
now does not mean you should stop saving for your future. Your savings will still
accrue, you'll be less likely to spend it, and you know it will be safe. If you
can afford to lock up your money for a while, longer-term Certificates of Deposit
(CDs) pay the highest interest rates.
Check with your local lenders and see what they can do for you.