According to Credit Cards.com, the average rate for new credit card offers have reached record highs. It’s tough to find an offer of less than 14.9%, even for people with good credit. As more banks have gotten out of the credit card business and the biggest banks have consolidated their domination of the credit card industry, high rates have stubbornly remained.

Why are rates so high now? No doubt the recession has played a part. With fewer people increasing their debt load, the credit card companies are looking to maintain their profits. Given the fact that the prime interest rate is at nearly 0%, you would think interest rates would have also tracked low. But they haven’t. Summertime is vacation time for many families, a time when people use plastic to reserve cars, pay for plane tickets, or check into hotels.

According to National Foundation for Credit Counseling spokeswoman Gail Cunningham, banks and issuers may be looking to bolster profits from customers’ vacation spending.

“Vacations are definitely a large-ticket expense, and if you have a rewards card, you’re inclined to charge every purchase in order to earn points or miles,” Cunningham said.  “People are well-intentioned and don’t intend to overspend, but so often get caught up in the moment and do exactly the opposite of what they’d planned.”

So what to do? If you already have a credit card at a lower rate, your best bet is to never miss a payment, to keep your rate where it is. However, the credit card companies still have the right to raise your rate at any time, and there is little you can do about it. Credit card reform laws have made it difficult for banks to jack rates up exorbitantly, yet with advanced notice they can still raise your rates. If you are carrying a lot of debt on your card you have two choices to avoid paying the higher interest rate: close your account to freeze the balance (which you still have to pay off), or pay off your balance before the higher rate kicks in a few weeks later.

Prepaid Cards to the Rescue

MiCash MasterCard holders of course have the option of “prepaying” for a family vacation on their prepaid card. This is a great way to avoid going into debt, avoid paying high interest rates, and tracking vacation spending. You simply put a big enough balance on your card to cover all of your vacation expenses, plus the temporary hold when paying at the pump (typically $75). Hotels may place a bigger hold of the equivalent of 1 or 2 nights stay on your card. The way to avoid a hotel hold is to hold the room with a credit card but pay for the stay with a prepaid card.

Of course, restaurants, theme parks, and many other destination places accept prepaid cards just as they accept credit cards. Just look for the MasterCard and Visa logo.

Once your vacation is over, with MiCash, you can simply log into your online card account to see all of your purchases listed by amount, transaction date, and name of the merchant. It’s a great way to evaluate whether you stayed in budget for different budget categories like food, entertainment, lodgings, and travel.

Watch Out for Low Introductory Rates

It’s common for credit card companies to offer 0% interest on purchases for new cards for a limited time period, say six months or a year. Some card offers have extended this time period out almost two years during this recession. But don’t take the bait. In the past, it was possible to shift balances away from one card to a new card to avoid the sudden surge in interest at the end of the introductory time period. However, credit card companies now charge transfer fees when trying to move a balance from one card to another.  Many of these temporary low rate cards are actually high rate cards in disguise. The unsuspecting consumer sees the 0% introductory APR rate and fails to recognize the 19% actual APR which kicks in after the introductory time period. Some cards also retroactively charge the full APR over the time period you carried a balance, if the balance is not paid off in full before the regular rate kicks in. This is especially common with store cards from department stores, hardware stores, and so on.