How much is your credit card balance costing you? How to find out — and negotiate a better rate

When it comes to picking out your credit card, the cool rewards should really be one of the last things on your mind. While it’s hard to overlook the amount of points you get for riding Uber or dining out, the most important number to be aware of is the credit limit (which determines how much you can spend per billing cycle) and your annual percentage rate (the amount of money your issuer will charge you for carrying a balance).

And yet, many millennials are glossing over these key numbers when they take out a new card, according to a recent survey from CreditCards.com. 48% of credit card users who carry a balance are either unsure or completely unaware of the APR on all of their credit cards, the personal finance site found.

Younger and more low-income borrowers were also the most likely to be in the dark about how much they were paying to swipe their plastic. Only a third of consumers aged 18 to 37 said they knew the APR on all their cards, a particularly concerning figure at a time when interest rates — in other words, the cost of borrowing — are on the rise. Since 2015, the average APR for credit cards has climbed from 15% to a little less than 17%, according to the site.

One reason why people are so likely to space on their APR is that they’re increasingly likely to view their credit cards as a tool for garnering points on lucrative rewards programs. Nearly a third of credit card consumers now swipe purely for the points, according to a separate study from the comparison site Finder.

Finder estimates that roughly $176 billion is spent chasing points each year — and while there’s nothing wrong with playing the points game, the important caveat is that you must pay off your balance each month in order to see any benefits. The best-paying rewards cards offer a return on investment of around 9.5% on certain purchases, according to industry estimates, far less than the average APR on even the lowest interest, no-frills credit cards.

How to get a lower credit card APR

Fortunately, getting a better rate on your credit card is often achieved simply by asking for it, according to a study from CompareCards — 64% of consumers who request a lower APR on their credit card receive an average drop of around 5 percentage points. And yet, only 25% of consumers take advantage of this option by making the request.

Credit card issues are willing to budget on other fees, too, if you simply pick up the phone and ask.

Nearly nine out of every 10 consumers who request a fee waiver receive one, and 64% of consumers who request a higher credit limit are successful as well. Requesting a higher credit limit, if you can use it responsibly, is one of the few surefire ways of quickly raising your credit score by lowering your utilization rate, which is one of the most important factors in your score.

It’s easy to see why more Americans aren’t taking advantage of this opportunity. If you’re carrying a large credit card balance, going over your statements is probably a source of anxiety. Spending an hour or two on the phone with your issuer’s customer service representatives may also seem like a less-than-ideal use of your precious free time.

But the higher your credit card balance, the more likely it is that you’re accruing unnecessary fees by failing to negotiate your APR. If the first representative you speak with declines to give you a lower rate, simply ask to speak to a supervisor and say you’re considering cancelling the card. If you’re anxious about getting on the phone, here’s a script.

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