Credit Card Quick

Prepaid Cards: Are they really a Better Alternative to Credit Cards?

Choosing Credit Card

You may have heard quite a bit about prepaid cards as of late, as many consumers and financial experts are touting their convenience and practicality. In fact, because of the poor credit sector and the inability of many consumers to obtain credit, prepaid cards have surged in popularity.

Prepaid Cards: How they Work

The concept behind prepaid cards is quite simple: a consumer purchases the card from a retailer and loads it with money. The prepaid card, which may be partnered with Visa, MasterCard, Discover and American Express, can then be used as a consumer would use a debit or credit card; to purchase items through retailers or to pay bills online.

Prepaid credit cards require no credit check, and are quite simple to get and load with money. It is no wonder then, that in 2008 alone, consumers loaded nearly $8.7 billion on prepaid cards; that’s up about $4 billion from the year before.

Prepaid Cards Popular Among College Students, those with Poor Credit

For individuals who may not be able to secure a regular checking account, a prepaid card may be a practical alternative. Often times, parents use them as a cash source for their teenage or college-age children, while others with little to no credit use them as they would any other credit card.

Given the fact that the new credit card legislation, when it goes into effect in February, will further restrict the ability of college students to obtain credit, it only makes sense that prepaid cards will see a further increase in popularity.

Prepaid Card Fees to Watch for

It is important, amidst all of the advantages, to know that prepaid cards do come with activation fees, and most of them charge for ATM withdrawals. However, when considering the hefty fees charged by banks and creditors, many consumers are more than happy to pay these fees.

For consumers looking for a simple, practical way to pay bills and avoid credit card charges and bank overdraft fees, prepaid cards may be just what they’ve been searching for.

Before you Start your Holiday Shopping, Read this!

Introduction

The holidays are upon once again and the question is: are you prepared?  Sure, you think. I’ve made my list and checked it twice. But is there more to planning your holiday shopping than just making a list?

If you want to keep your credit card spending in check, and keep credit card thieves in check, then you bet.

There are plenty of things you need to keep in mind before you head out the door to get your holiday shopping started:

• Make a budget and stick to it. The holiday season, in particular, is one time of the year when overspending and impulsive purchases are common. There are plenty of deals, sales and specials that are there to great you around every corner, so having a budget – and sticking to it – is crucial for keeping your credit card bills to a minimum. Without a budget you may be tempted to get carried away with purchases and, before you know it, you have spent more money than you can reasonably and realistically pay back.
• Keep you credit card close at hand. The holiday season is a prime season for credit card thieves, as stores are packed and consumers’ defenses are down. In particular, keep your credit cards secure in a purse or wallet, and make sure they are not easily accessible to a pick-pocket. Avoid using backpack-style purses, as these are often quite easy for a thief to gain access to, even while it’s on your back! And if you carry your wallet in your back pocket, consider moving it to a front pocket instead. In addition, be cautious of any retailer that needs to take your card out of your sight to complete a transaction, as this can often indicate a card skimming scheme.
• Be cautious about using retail credit cards. Sure, they may seem tempting, and can be opened and used within a matter of minutes, but think twice before using a store credit card. Often times, they come with hefty fees and even heftier interest rates, so steer clear of them, when possible, and instead use your fixed, low-interest credit card.

Credit Card Changes we can Expect in 2010

News

This year’s been a rough one for credit cards. From credit card restrictions, credit card legislation and more credit card changes to make our heads spin, the credit card industry has been a difficult one.

Many individuals have lost their ability to obtain credit, while others who never had a difficult time securing credit found themselves unable to obtain credit, as well. Credit card companies put the brakes on gimmicks and high credit limits and credit card consumers found themselves drowning in credit card debt because of outrageous fees and skyrocketing interest rates.

However, as we look to 2010, we can expect things to calm down significantly. In particular, after the remaining credit card laws have been enacted in December, the uncertainty felt on both sides of the equation – the credit card companies and the consumers – should begin to settle and, in general, the credit card industry will adjust to its rules and regulations.

Some of the changes we can expect to see next year include:

Fewer Gimmicks – All of those credit card gimmicks that we have gotten used to receiving over the years will likely not be there anymore. Credit card companies, under the new laws, are simply not allowed to offer hard-to-understand gimmicks, and they really cannot afford to anyway. Because of the tighter restrictions on credit card companies, creditors will target only those with good credit, thereby eliminating the need to offer gimmicks.

Looser credit restrictions – Individuals with poor credit will have been weeded out by this time, thereby leaving only those with good credit. Because of this, creditors may soon be offering more competitive deals to those with great credit. Looser credit restrictions may mean credit will begin flowing a bit more freely next year, including personal loans and credit card offers.

More responsible credit card users – As we said before, the individuals with poor credit will simply not be able to secure credit, which leaves more responsible credit card users. Because of this, credit card companies may be offering better credit card offers to those responsible credit card users.

Cash versus Credit: Which is Best for Holiday Shopping?

Choosing Credit Card

We all want to watch our pennies and avoid overspending in today’s economy; and this is all the more evident when it comes to holiday shopping. Because of this, we may be inclined to keep the credit cards at home and use cash instead. But is this the best solution?

Perhaps not. Although the concept of only purchasing what you can afford to pay off within a month or two is an excellent idea, it may not be beneficial to pay for your holiday purchases with cash, and here’s why:

• Cash can be stolen – Yes, so can credit cards, but the biggest difference is that the answer to a stolen credit card is a simple phone call to your creditor to have the account frozen and the card replaced in a matter of days. Once cash is stolen, however, you can all but forget having it returned to you. In other words, a wallet full of cash may just be too risky.
• Cash can’t provide you with proof of purchase – If you lose a receipt and pay cash for the item, there is no evidence that you purchased it in the first place. However, a credit card statement is proof of your purchase, which may provide you with an extra insurance policy in case you lose a receipt. In addition, you may also have rights as a cardholder if you have a dispute with the retailer.
• Cash can’t offer you rewards – Many of today’s credit cards offer great rewards for doing what we do anyway: shop! So why not take advantage of these rewards programs and use your credit card to do your holiday shopping?
• Cash is often not convenient – Let’s face it: fumbling around in our purses and wallets for cash and loose change can be a bit of an inconvenience. A credit card transaction is therefore generally smoother and more convenient than a cash or check transaction.
• You can’t use cash online – There are many, great online deals to be had this holiday season, so it may pay to take advantage of them. However, you must have a credit card to complete most online transactions.

How to Effectively Resolve a Conflict with your Creditor

Introduction

The relationship between consumers and creditors has been strained this past year. Between the poor economy, the new credit card legislation and what seems like forever-changing rules to the credit card game, tensions have run high and many credit card consumers are more than a bit confused about their credit card bill and the new changes that seem to be popping up out of nowhere.

If you have a concern with your credit card company, it is best to avoid contacting them in hopes of a screaming match. Yelling and complaining will get you nowhere fast, so it is important to prepare yourself and ask the right questions to your credit card dilemma.

The following steps will help you resolve a conflict with your creditor:

• Your first point of contact will no doubt be a customer service representative. Explain your issue and speak slowly, clearly and remain courteous. Keep all of the necessary information close at hand so that you can refer to a particular bill or transaction.
• Keep a pen and a piece of paper nearby, as well, so you can jot down appropriate notes. Remember to write down the time and date of your call; remember to also ask for the name of the representative.
• If you feel as if the customer service representative cannot handle your problem or if you feel as if you are simply getting nowhere with a resolution then you have the right to ask to speak to a supervisor. However, remain courteous during the entire phone call.
• If you get nowhere by calling the credit card company, make your case in writing. Include all of the information from your phone call(s) and send the letter certified mail so that you have proof that the credit card company received your letter. If you don’t receive a response from the creditor within a few weeks, you can follow up with a phone call or be prepared to take other actions.
• File a complaint with the Better Business Bureau, the National Credit Union Administration, the Federal Reserve or the Federal Deposit Insurance Corporation.
• Make sure you follow the above chain of command when attempting to resolve a conflict, as you may need this information if you need to take the issue further.

How to Prepare for a Lost or Stolen Credit Card

Identity Theft

If your credit card was lost or stolen tomorrow, would you know what to do?

Quick: what is the name of your credit card company and what is their contact information?

If you don’t know the answer to this question, you’re not alone. Many consumers simply don’t know who to call or what to do if their credit card was lost or stolen. And, unfortunately, not having this information on hand can end up costing you much more than a credit card.

Here are the steps to take if you simply can’t locate your credit card:

1. Before you find yourself with a lost or stolen credit card, keep a list of all your credit cards, along with their numbers and contact information, in a safe place so that you have a reference to turn to.
2. Take a deep breath and try to remember the last time you used your credit card and where you used it. Often times, we may misplace our card during a particularly hectic day and end up panicking when we can’t find it.
3. If you have checked your home, your car and your personal property thoroughly and you are convinced that the card has either been lost or stolen, you will need to take immediate action and contact your credit card company. You must report your credit card missing or stolen so that you won’t be held responsible for all of the charges placed on your card.
4. Get in the habit of carrying only one card with you at any given time to reduce the damage done by a credit card thief. If you are the victim of a pickpocket or mugging, you won’t have to deal with reporting multiple cards.
5. Remain knowledgeable and know that credit card thieves may be able to steal your credit card information, even without stealing the card itself. Keep your credit card close at hand while shopping and only shop on trusted websites with secure servers.
6. Check your credit report on an annual or semi-annual basis so that you can check for anything out of the ordinary on your credit report.

How to tell if your Credit Card isn’t Working for you Anymore

Choosing Credit Card

Your beloved credit card, which you have toted around with you since college, may just not be working for you anymore.

Many creditors are in the process of changing their terms and conditions because of the newly introduced credit card legislation. It is therefore extremely important to keep abreast of all changes that may be taking place with your creditor and your credit card.

Don’t cast aside the information included in with your monthly statement; instead, make sure to read it carefully, as it could change the way you use your card. It may also prompt you to ditch your current credit card in favor of another one with more competitive features and benefits.

How to tell if it’s time to move on:

• Customer service is lacking – Excellent customer service is usually on the top of many cardholders’ wish lists when it comes to deciding on a credit card company. You may want to ask yourself if you have been satisfied with the customer service the last time you called. For example: Did the customer service rep handle your problem/question in a professional manner? Was the problem remedied in a reasonable amount of time? Was the customer service rep polite and friendly? If you answered “no” to any of these questions, then it may be time to find a creditor that takes pride in excellent customer service.
• Your interest rate goes sky high – Many creditors, in response to the new credit card legislation, are now raising interest rates to make up for decreased profits. If you have been a loyal customer and have always paid your bills on time, then you should not have to put up with a hike in your interest rate.
• Your credit limit is cut – Just like increased APRs many creditors have begun cutting credit limits on current customers. Once again, if your credit limit has been cut but you have proven to be a loyal and responsible customer then you shouldn’t have to deal with a decrease in your credit limit.
• Your rewards are not what they cracked up to be – If you chose a rewards credit card, but the rewards are riddled with exceptions and restrictions, then you may want to look for a new rewards card with less restrictions and more ,well, rewards!

Why Debt Settlement Agencies Continue to Flourish in Today’s Economy

Credit Repair

If you are in over your head in credit card debt, and you don’t know where to turn, you may consider a debt settlement agency. They have become increasingly popular over the last year or two because of the millions of Americans struggling to pay their bills.

Many Americans have lost their jobs, exhausted their savings and have begun living off credit in order to get along. However, as this solution is only temporary, at best, many individuals find themselves in serious financial straits and with more credit card debt than they know what to do with.

Avoiding Bankruptcy

Throughout all of this mess, many Americans want to avoid bankruptcy at all costs; which is why debt settlement seems to appealing. They are often looking for a quick and easy way to clear their debt without filing for bankruptcy.

The process of debt settlement seems pretty straightforward: the consumer contacts the debt settlement company who, in turn, makes deals with the consumer’s creditors to repay a portion of their debt. The consumer then begins making payments to the debt settlement company who, in turn, pays off the creditors.

But is this the best solution?

Avoiding Scams and Fraud

Many times, consumers find themselves paying significant fees to debt settlement agencies who do nothing more than act as a third party to pay on the debt. Even worse, many debt settlement agencies take the money and run, never paying off the debt and leaving the consumers in more of a mess than they started with.

Although there are certainly upfront debt settlement agencies that do their job, there are just as many that do not. Your best option is to avoid using a debt settlement agency and instead turn to nonprofit debt counseling services.

Make sure that the debt counseling service that you use has a strong history and a positive reputation. Check the company’s credentials and follow up with a search with the Better Business Bureau.

Remember: you should never have to pay a fee for consumer credit counseling services, as they are generally nonprofit companies who help you manage and pay off your debt, without filing for bankruptcy.

Tips for Smart Holiday Shopping

Introduction

Smart holiday shopping starts with a budget and a game plan. Without these two things, your holiday shopping expenses can quickly spiral out of control. Most of us have been in the situation where we charge our holiday purchases to our little hearts’ content, only to be sacked with huge credit card bills come January.

There are a few, simple ways, however, to make this holiday season memorable – without breaking the bank:

• Make your list and check it twice – There is nothing more detrimental to your holiday budget than wandering the stores without a general idea of what you are looking for. It is therefore of the utmost importance to do your homework, nose around and ask plenty of questions so that you can make a list of the holiday items your loved ones are hinting around for. You may also want to cruise the Internet to get a better idea of where to find certain items, to compare brands and to check prices between competitors.
• Create a reasonable budget and stick to it – Heading out the door to start your Christmas shopping without a budget in mind can spell disaster. So, along with your list, decide how much you can afford to spend on each individual. Although it may be difficult to stick to a budget, your wallet will thank you come January, when you will be one of the fortunate few not to have overwhelming credit card debt.
• Get creative and save – Remember that not everything needs to be expensive. It may sound contrite, but many individuals appreciate gifts from the heart as much as they do expensive ones. Use your talent for knitting to create a beautiful blanket for your new niece; purchase a gift card – and free babysitting services – to your brother and his wife; and frame personal photographs in unique and interesting ways for your parents.
• Check your credit card limit, interest rate and related fees before heading out the door. The last thing you need while shopping is trouble with your credit card.

Credit Cards and Divorce: What you Need to Know

Introduction

Simply put:  understanding your rights concerning your joint credit card accounts is a must when speaking of divorce.

We’ve all heard the horror stories of a spouse being sidelined with incredible credit card debt from a spend-happy, vindictive, soon-to-be-ex. Although this scenario is not common, it is important to understand the steps you need to take to safeguard your credit, both during and after a divorce:

• Get a credit card in your own name – It’s no secret that divorces can wreak havoc on an individual’s credit, so it is best to secure a credit card with a competitive interest rate now, before the divorce proceedings get underway.
• Contact the creditors of your jointly held credit card accounts to update your personal information. Obtain and keep a current credit card statement as proof of your jointly held debt; therefore, your soon-to-be-ex will be held responsible for any debt put on the card from here on out. You may also have the right to freeze the account from any further activity until the divorce is finalized.
• If you and your spouse are still on speaking terms, have a frank discussion about your joint credit card debt and how it will be paid off. Many couples choose to pull money from a home equity account or savings to pay off the debt, thereby resolving this issue of the divorce.
• Order a copy of your credit report once the divorce is finalized, or several times throughout the divorce if the process of lengthy. Make sure there are no new accounts in your name, or that accounts that were previously closed are now open.
• Remember to update your address, if necessary, so that you can stay on top of your credit card bills. Now is not the time to fall behind on your credit card bills!

Although a divorce is a difficult process, often riddled with emotions and hurt feelings, it is vital that you tend to your credit card debt and other personal debt so that you won’t be left with a damaged credit score.