Credit Card Quick

The Top Three Points to Better Credit Card Management

Introduction

A credit card comes with a certain set of responsibilities. It is up to you to understand the terms and conditions of your credit card so that you can maintain your card and protect your credit score at the same time.

The bottom line is that many consumers simply fail to carefully read and understand the terms and conditions of their credit cards, which only hurts them (and their credit score) in the end.  Although the new credit card legislation recently signed into law by President Obama will certainly go a long way in protecting consumers, it still comes down to personal responsibility.

And the best way to remain in control of your credit is to simply understand it.

What You Need to Understand about your Credit Card:

• Your APR – You certainly can’t manage your credit card effectively if you don’t know you card’s APR. If you have an introductory rate, you need to pay attention to how long it will last, and certainly what the APR will be once the introductory period has ended. Also, keep an eye on the APRs of other, competitive credit cards to make sure you are always getting the best rate. If not, contact your creditor and ask for a lower interest rate; if they refuse your request, search for another credit card with a better APR so that you’re always ahead of the game.
• Your statement – Your statement should be read carefully, every month – no exceptions! Countless Americans lose money every year because of inaccuracies on their statements that they simply never caught. Keep all credit card receipts and use them to check your statement each month. Also, pay close attention to any other types of fees, as well as past payments, to make sure they appear accurately, as well.
• Your billing cycle – Your billing cycle is crucial to your payments, your interest rate and, most of all, your credit score. Make sure you are aware of your credit card’s billing cycle, as well as the due date for your next payment. Knowing this information will keep you from forgetting to make payments, and it will also ensure that you make your payments on time, each and every month.

The First Credit Card Reform Rules get Underway

News

August 20 marked the first day of the new credit card reform. Although the majority of the new laws won’t take effect until February 2010, there were a select few that made their way into the newest credit card legislation last week.

The new credit card rules, under the Credit Card Accountability, Responsibility and Disclosure Act, include: creditors must give their customers a 45-day notice of interest rate or fee increases; and creditors must allow their customers at least 21 days to pay their bill each month.

The Credit Card Accountability, Responsibility and Disclosure Act, which was signed into law back in May by President Obama, is designed to put an end to questionable practices by credit card companies. The many rules of this law include placing restrictions on credit card billing practices.

Although many agree that credit card reform is long overdue, it’s important to see both sides of the equation. In an effort to fight back against these regulations – and control the amount of money they will lose – many creditors have already begun imposing their own set of new regulations.

What to Expect from Creditors

As many of us have already seen, creditors have begun raising interest rates. In fact, according to Bankrate.com, the average variable interest rate on new cards is about 11.22%, up from 10.69% just three months ago.

Many creditors have begun revamping their terms and conditions and have found ways around the new credit card restrictions. In other words, many credit card holders have seen their creditors switch up the rules in just the last, few months.

For example, many creditors have begun not only hiking up interest rates, but also slashing credit limits and canceling cards for less-than-stellar credit card customers.

In addition, don’t expect many mail solicitations for credit cards – although that may not be a bad thing – and don’t expect many credit card companies to offer introductory or “teaser” rates for new credit cards.

Whether we like it or not, we all must be prepared for creditors to fight back against the new credit card regulations. As with anything else, sometimes we all must take the good with the bad and learn to adjust accordingly.

The Top Three Ways to Keep your Low Interest Credit Card

Introduction

If you are one of the lucky few to have a low interest credit card in your back pocket, then congratulations are in order! A low interest credit card means that you have worked hard to maintain an excellent credit score and a gleaming credit history.

Don’t assume, however, that once you earn your low interest credit card that it will be there forever. Instead, you must continue to prove that you are a good credit risk and that you deserve the perks that go along with a low interest credit card – especially given that many creditors are pulling low interest credit cards right out from under their cardholders the first time they make a mistake.

The following three tips will help you keep your low interest credit card:

1. So, it’s a no-brainer that you must pay your low interest credit card bill on time each and every month to maintain your low interest rate. However, did you also know that your creditor could be watching your other debts, as well? It’s true! Many creditors are now frequently checking their cardholders credit reports and, if they see other delinquent bills, they may very well relinquish their customers’ low interest status.
2. Keep your debt to a minimum. In order to qualify for the lowest interest credit card, you will need to keep your debt-to-income ratio in check. Always aim to stay well under 40 percent so that you will continue to show creditors that you are a safe credit risk.
3. Consider utilizing an automatic bill payment service so that you don’t risk paying your credit card late. Most of us have, at one time or another, been in a position where we simply forget to pay a bill on time. Well, with low interest credit cards, you simply can’t afford to not pay your bill on time, as one misstep could result in a rise in your APR.

An easy solution to this are automatic bill payment systems which take care of business, regardless whether you remember your card’s due date or not. A one-time set-up, either through your creditor or your bank, is all you need to set up an automatic bill payment system.

The Top Five Tips to Remember about your Student Credit Card

Choosing Credit Card

A student credit card is often a great way for a college-age student to begin working toward a positive credit score. However, it is also a time when many students mismanage their credit cards and end up not only putting themselves in debt, even before they graduate, but also ruining their credit score in the process.

It is therefore important to remember that your student credit card comes with its own set of perks, as well as responsibilities. The following, five tips will help guide you as you begin to build a healthy relationship with credit cards.

1. Look for a student credit card that offers no annual fee and competitive interest rates. It is a common misconception that you must pay high fees and interest rates with your first credit card. Although you may not be eligible for the lowest interest rates, as they are generally reserved for consumers with a long credit history, you can definitely shop around and find a competitive interest rate to suit your needs and budget.
2. Look for a student credit card that is designed specifically for college students, as these types of credit cards often offer incentives and rewards when the cardholder uses his/her credit in a responsible manner.
3. Look for a student credit card with rewards. For example, you can earn rewards for free gasoline and free airline tickets. Some creditors even offer rebates or cash back rewards for maintaining a good GPA!
4. Always consider your needs and wants before making a purchase. Although this can be a hard habit to get into, it is important to take a step back before making a purchase to ask yourself if your purchase is a need or a want. Often times, using this approach can stop you from overspending and getting yourself into a situation where you are faced with high debt and no way of paying it.
5. Be aware and educate yourself on the new credit card legislation that is set to begin in February 2010, as there are specific laws that will affect who – and who cannot – can get student credit cards.

The Top Five Tips to Remember about your Business Credit Card

Choosing Credit Card

A business credit is a smart financial tool for many business owners, and many business credit cards offer a nice variety of features and perks which help business owners manage their business in the most effective manner.

It is therefore extremely important that business owners find the right business card to best suit their needs. With that said, there are five tips to remember when shopping for a business credit card:

1. If you are thinking about simply using a personal credit card for business purchases, think again. Mingling your personal accounts with your business accounts will simply cause confusion – and a great deal of frustration – when balancing your books and filing your income tax returns.
2. Consider searching for a business credit card that offers a year-end, itemized statement. This incredibly practical business credit card feature sure beats searching for receipts, organizing expenditures and scratching your head over where the money was spent.
3. Consider a business credit card for building your business credit. Building business credit is just as important as building personal credit, as it allows you to obtain capital in the future, if necessary.
4. Consider searching for a business credit card that offers small business perks or rewards. There is a nice variety of business credit cards that offer discounts and rebate programs for small businesses, so consider taking advantage of one of these business credit cards for your business.
5. Consider using a business credit card to track your employee spending.  Many business credit card accounts enable you to provide your key employees with their own credit card – with a limit preset by you. This enables you to monitor their spending, yet also allows them to handle some of the financial aspects of your business.

A business credit card may be just what your business needs. From small business incentives and rewards to convenient account features and online tools, it pays to do your research to find out what a business card can offer you and your business.

The Top Five Tips to Remember about your Rewards Credit Card

Credit Card Rewards

Rewards credit cards offer many consumers a nice variety of credit card perks. They enable consumers to spend as they normally would while at the same earn rewards for nearly anything from cash and free hotel stays to rebates and frequent flier miles.

In order to take full advantage of your rewards credit card, however, there are a few things to always remember:

1. When deciding upon a rewards card, it is important to look further than just the rewards benefits of the card. In other words, don’t forget to pay close attention to the card’s APR, annual fee, terms and conditions, as these could very well defeat the advantages of the rewards card if they are not competitive.
2. If you don’t plan on paying off your balance every month, the money you may end up paying in interest fees will likely cancel out any rewards offered by the cardholder. If you plan on carrying a balance, it may benefit you more to simply look for a credit card with a low, fixed interest rate.
3. Pay close attention to how and when you can redeem your credit card rewards. Many consumers, for example, are shocked to hear that their rewards expired because they didn’t redeem them in time when, in reality, the information was always readily available if they only had taken the time to read it.
4. Before choosing a rewards credit card, take the time to compare the perks of several different credit cards. For example, rewards credit cards that offer frequent flier miles are not all the same, and you may benefit more from one card than the next
5. Always read the information sent to you by the creditor, as it could contain important information about your rewards or your credit account. Some rewards credit cards, for example, offer perks for using specific retailers, and these perks often change on a monthly basis.

Remember: to take full advantage of your rewards credit card, always carefully read the card’s terms and conditions. If you don’t understand something, call the creditor and ask questions so that you can enjoy the benefits that come along with your rewards credit card.

How to Use your Credit Card for Safer, Online Shopping

Card Security

Online shopping is enjoyed by millions of Americans each year, and is a great way to purchase the items and services you need or want without heading out to the store to do so.

However, along with the convenience of online shopping come the risks; in particular, the risk of fraud, theft or identity theft. Although there are no safeguards that can protect you 100 percent, there are many things you can do to ensure that your next online shopping experience is a safer one:

• Only shop at retailers with which you are familiar. If often just does not pay to shop with an unfamiliar online retailer.
• Never conduct business with a website that doesn’t have a permanent address and phone number.
• Look for the encryption symbol at the bottom of the webpage. The encryption symbol usually looks like a padlock; if the padlock is closed, the website is secure; if it is open, the website is not secure.
• Look at the website’s address. If the address begins with “https” then the information you provide should be secure; however, if the address begins with “http” then the information you provide may not be protected.
• Before shopping, carefully read the terms and conditions of your credit card, as to make sure that you are protected in the case of credit card fraud. Your card’s language should include information about your liability in the event of credit card fraud. If you can’t find the language in your card’s terms and conditions, call the creditor and ask for an explanation of your rights regarding credit card fraud.
• Consider purchasing from website’s that ask for your CVC2 code (they may call it a security code), which is a three-digit code located on the back of your credit card.
• Always read your statements carefully, and report any suspicious activity or unauthorized charges on your credit card immediately.

How Many Credit Cards do you Really Need?

Choosing Credit Card

We hear conflicting opinions all the time regarding the number of credit cards we should have, must have, and never exceed. But what is the magic number?

Well, for starters, there is no magic number, and what works for you in terms of the number of credit cards may very well not work for another individual. There are, however, a few points to remember when considering your perfect number of credit cards:

• Pay close attention to your debt-to-income ratio. If you have a card with a balance that exceeds 50 percent of your credit limit, then you may be entering into dangerous territory because many creditors may perceive you to be a credit risk. However, if you exceed 50 percent of the credit limit on one of your cards, it may not be such a big deal, credit-wise, if you have another card or two with low balances, as this will decrease your debt-to-income ratio.
• Consider holding at least two credit cards if you feel comfortable that you can effectively and responsible manage the two cards. However, if you tend to spend on your credit cards then a second credit card may not be the right decision for you. Again, this is where “one sizes fits all” does not apply.
• Don’t hold so many credit cards that you have difficulty managing them. In other words, if you have 10 cards, all with low balances, then you are ahead of the game. However, if these 10 cards create confusion when it comes time to paying them, then they certainly are not worth the hassle, even if you have a fantastic income-to-debt ratio as a result. If you are unable to effectively manage your cards then chances are you will miss due dates and payments, thereby negatively affecting your credit score.
• Be careful about closing credit card accounts, as this may negatively affect your credit score; specifically, your income-to-debt ratio.
• Consider choosing major credit cards (Visa, Master Card, Discover and American Express) over department store credit cards, as major credit cards typically have higher credit limits (which have a positive effect on your income-to-debt ratio) and lower interest rates.

Great Ways to use your Credit Card to Earn Frequent Flier Miles

Credit Card Rewards

Frequent flier miles are a great way to earn free air travel and, best of all, you need not fly to earn them!

When frequent flier miles were first introduced in the 1980s, consumers could only earn them by flying. Now, however, there are many credit cards that enable you to earn frequent flier miles by simply making the purchases you normally would.

• Check to see if your frequent flier program has an affiliate credit card (most of them do!).  You can then begin earning miles on everything from grocery purchases to airline ticket purchases. Plus, many credit cards that offer frequent flier miles will also offer an incentive to sign up for their card, in the form of frequent flier miles. In fact, many creditors will offer new customers 10 to 20 thousand frequent flier miles, just for signing up!
• You may also consider signing up for a credit card that offers membership rewards (both American Express and Diners Club have these programs). Many of these credit cards offer membership rewards points that can be converted into frequent flier miles, for your airline of choice!

However, many of these membership rewards credit cards require that you pay off your balance in full each month, so they are certainly not meant for consumers that typically carry balances on their credit cards.

• Consider applying for a credit card that offers you frequent flier miles for simply charging purchases at select retailers. For example, your creditor may offer you frequent flier miles by staying in a participating hotel or eating at a participating restaurant.
• Finally, consider enrolling your existing credit card into a rewards network, which is essentially a group of partnering retailers, like restaurants, bars, and associates of the major airlines. Then, each time you make purchases within that rewards network you automatically receive frequent flier miles.

Remember to explore all of your options regarding your credit card choice. And remember: there are many, different ways to begin racking up those frequent flier miles for your next trip!

The Debit Card/Credit Card Debate: Which one is Right for you?

Choosing Credit Card

Many Americans now use debit cards as an alternative to paying by check, cash or credit card. They certainly are a convenient way to for purchases, but are they the right form of payment all the time?

Well, this answer certainly is up for debate, although there are plenty of pros and cons, for both credit card and debit card use, which you should consider before making your next purchase:

Pros of Debit Cards

• Ideal for consumers who want to avoid credit card debt
• Usually no fees associated with debit card purchases
• Ideal for staying within your budget, as the money is withdrawn from your bank account
• Usually accepted where most credit cards are accepted
• No monthly bills or interest rates to worry about

Cons of Debit Cards

• You may face large insufficient fees through your bank if you overspend (this can be solved by linking your savings account to your checking account for overdraft protection)
• May not afford customers the same incentives and perks of credit cards (cash back rewards, rebates, etc.)
• May not offer the protection against fraud and defective goods and services that credit cards offer
• A thief may be able to drain your bank account before you notice fraud (although your debit card may be protected against fraud, it may take some time to receive your lost money)

Pros of Credit Cards

• No need to pay interest fees if you pay it off within the first billing cycle
• Typically accepted at most retailers
• Offers the luxury of buying now, paying later
• May prove extremely useful in emergency situations
• Offers different types of perks and incentives, such as cash back rebates and travel incentives
• Protects cardholders from fraudulent account activity or defective goods and services
• Positively affects your credit score, if used properly

Cons of Credit Cards

• Can negatively impact your credit score, if used improperly
• Charges interest fees if the balance is not paid in full each month
• Can cause you to overspend, or purchase items that you don’t need
• Can get you in over your head in debt, thereby negatively impacting your budget