Credit Card Quick

A Closer Look at Credit Card Dependency

Credit Card Debt

No one wants to be dependent on credit cards all the time. Credit cards have their place: they can provide unmatched convenience and practicality; they can provide a safe, secure way of spending; they can increase our credit score so that we can be eligible for the lowest interest rates on other types of financing; and they can offer us rewards and perks for simply spending.

However, for many individuals, credit card debt has become a monkey on their back, so to speak. If you are afraid to open your credit card statement each month then you could very well be the credit card consumer who is in desperate need of a credit card intervention.

You can learn to use credit cards responsibly, and you can learn how to effectively eliminate your credit card debt so that you can lead a more financially secure future:

• Keep track of your spending – OK, so this sounds like a bit of a scary proposition; but the fact of the matter is that if you simply take one, full month and record each and every purchase you make, you may quickly become enlightened. If you scratch your head at the end of every month and wonder what in the world you did with all of your money then recording your purchases may be a great way to begin understanding where your money goes and how you can begin changing your spending habits.
• Take the extra money you found and put it towards your credit card debt – Take your newly found money – and there will be money after you begin understanding where, when and how you are spending your money – and immediately put it towards your credit card with the highest APR.
• Pay yourself first – Before you pay your first bill or spend the first dollar of your paycheck, take the time to pay yourself, however small. Better yet, set up an automatic deduction from your paycheck to a high-yield savings account through your employer or bank and you won’t even miss the money.
• Slim down the credit card pile in your wallet – There is absolutely no need to carry around multiple credit cards. One, competitive –rate credit card is all you need for your day-to-day living. Eliminate all of the retail cards in your life (the often have way too high APRs and fees) and take out all but one major credit card. Having a couple major credit cards is a good idea, but leave the others at home, in a safe place, instead of in your wallet. Eliminate the temptation that comes along with carrying around credit cards!

Battle of the Cards: Why Merchants Accept Some Cards Over Others

Introduction

If you are a credit card carrying consumer, you know it can be very frustrating to head out to a store to make a purchase, only to find your plans waylaid by the store’s nonacceptance of certain credit cards or exclusive loyalty to one you do not carry. In an ideal world, every merchant would accept every credit card brand. In reality, this is not the case, nor is it reasonable to expect the average consumer to have a stock pile of  every credit card waiting in their wallet “just in case.”

While this can be a frustrating situation for the consumer, it is also important to put yourself in the merchants’ shoes and try to see things from their point of view. The truth is, most of them would probably like nothing more than to allow their customers to pay with whatever credit card they have on hand. Unfortunately, not all of them can.

Payment Processing

Visa and MasterCard only require one network to process payments. Discover requires a separate one, as does American Express. Merchants have a tough choice to make initially, because they have to choose the most cost effective method that they can afford. They need to choose the network that offers the best deal in both start-up and overall fees to suit their particular needs. Sometimes it is a matter of personal network preference, however, it’s usually more about what is best for the business overhead in the long run.

Merchants typically have to swallow the cost of initial account set-up and processing equipment. Then, they must pay maintenance fees and per transaction fees, which while typically minimal on a per transaction basis, really add up quickly. This can put a dent in the profit margin. On top of that, merchants often need their money sooner rather than later, so they need to choose a network that pays them at a rate that satisfies their preferences.

With these things in mind and the differences in rates per credit card company, a merchant really has no choice but to choose the network that is best for them, eve if it means alienating customers who carry cards they will not be able to accept. It may not be ideal, but that’s just the way it is.

They’re Thinking of You Too

One last thing to keep in mind when you become irritated that the store does not accept your card: appreciate it. While it may be inconvenient, the merchant is not thinking only of their bottom line. They have their customers in mind too. Accepting more cards with higher fees and expenses would drive up the cost of their products, affecting their sales and your pocketbook.

Visa or MasterCard? What to Choose

Choosing Credit Card

Visa and MasterCard are the top two companies leading the credit card industry. However, since the credit cards themselves are issued by banks and other financial groups, some consumers may find themselves wondering which card to choose. Is Visa a better choice than MasterCard or vice versa?

In a word, no. Visa and MasterCard are quite similar in the products they offer, customer benefits, and acceptance. Pricing may vary somewhat, but terms and conditions are generally a mix between general Visa and MasterCard rules and those of the issuing institution.

Worldwide Acceptance

Visa and MasterCard are both more widely accepted around the world than any other credit card type. While acceptance may be a bit different in some countries, some limited to tourist-oriented places and others with broad acceptance, you can still count on the benefit of cash advances at ATMs around the world. In foreign countries, as with any kind of currency exchange, there will be a foreign exchange transaction fee. MasterCard does have a few more ATM locations, while Visa has slightly more merchants.

It’s Not The Logo That Matters

Some people do prefer Visa over MasterCard, while others might see it the other way around. Really, it is a matter of personal preference. For those who prefer having two credit cards to rely on, a good bet is to have one Visa and one MasterCard. That way, should you encounter the situation where only one is accepted, you are well prepared.

Visa and MasterCard are both reputable companies and offer a wide array of products to suit the financial needs of their customers. However, you don’t want to make the mistake of thinking that because your card has either logo that it was actually issued to you directly from Visa or MasterCard. Both companies are a simply a form of payment method, offering accounts to merchants. They make their money through transaction fees charged to the merchants for using their method process payments. Your card itself is issued to you by a financial company (as briefly mentioned earlier) who has an account with Visa and/or MasterCard for payment processing.

It’s  All About You

So, you see, it really does not matter which logo is on your credit card. If your personal preference leans toward one or the other, then you should go with that. It’s more about the terms, conditions and benefits of the credit card being offered by your financial institution and the ability of the product to meet your needs.

Does it Really Pay to Discover?

Introduction

Discover is a leading competitor among credit card companies. First issued in 1985 by Sears, then the largest retailer worldwide, as an attempt to add financial services to their plethora of offerings, Discover eventually became its own brand; an independent company.

Unlike Visa and MasterCard, the majority of Discover cards are issued directly to the consumer by Discover Bank. While the brand is not yet issued or accepted worldwide, it continues to grow at a steady rate, being accepted by more and more places. Maybe someday, Discover will become a global brand.

Discover Card Acceptance

While Discover is not accepted in all places, it does have a wide merchant network and ATM locations for cash access all over the world. In the U.S., there are some merchants who do not accept Discover and still others who either accept all type of credit cards or are exclusive to the Discover Card Network.

It just depends on where you are shopping.

This does not mean that a Discover Card should be excluded as a credit card of choice. Discover has a fine reputation and is a leader in revolutionizing the credit card industry. If you’re a person who uses your credit cards often and want to be prepared for whatever a merchant might be accepting, it is a good idea to have a Discover Card on hand.

Cash Back, Rewards and Customer Benefits

Discover was the first to offer a cash back program and even to this day, theirs is more generous than that of other credit card networks. Discover also offers miles cards for frequent fliers, a bevy member of benefits and rewards, no annual fee and an APR as low as 11.99% and up to 20.99% (compared to some who charge as much as 23%). They even offer a 0% introductory APR on balance transfers for the first 12 months for customers with excellent credit and 0% APR on purchases for the first six months (w.a.c.) with a low APR to follow.

Discover also has other products, such as student loans, financial services such as savings and bank CDs, complete fraud protection and excellent service that puts the customer first. They guarantee live help on the phone within 60-seconds, a refreshing prospect in this day and age of on-hold technology.

Discover Card rates are pretty well in-line with that of their competitors. They do offer a larger credit line and your credit score needs to be pretty good to get approved. In the end, however, it does,indeed, pay to Discover.

Credit Card Cash Advances: What You Need to Know

ATM

Credit card cash advances. A good idea or a transaction you should avoid altogether? Some say yes; others advise consumers to steer clear of cash advances. The truth of the matter is that a cash advance can sure be lifesaver when other funds are limited. While you probably should not abuse the privilege by running out and getting some cash on every little whim, it is nice to have the option if and when the situation calls for it.

Things to Consider

Cash advances really are not the solution for a general cash flow problem. If you do not have enough money to pay your bills and meet your needs, how can you expect to pay off your credit card? Cash advances need to be reserved for emergencies where even though you have enough income, you just can not access the cash right then and there from some other source, but you know you will have the cash soon enough to not only meet all of your living expenses but to pay off what you owe on your credit card balance as well.

That said, there are a few other things you need to know before you run to the ATM to withdraw that green.

Grace Period

For most purchases, credit cards offer a grace period for paying down the balance before finance charges set in. With a cash advance, the grace period typically is not an option, and those finance charges go into effect as soon as you make the withdrawal.

Cash Advance Fees

In addition to any other fees you will already be paying on your credit card and your cash advance, you will incur a fee for your cash advance. This is a percentage (usually 2%-4%) of the amount of the cash advance. If your cash advance is $500, you will be paying a minimum of $10 and a maximum of $20 for the cash advance fee. This can get expensive on top of your other credit card fees and purchases. While you definitely want to take out enough to make the fees worthwhile, you also do not want to take a credit card cash advance and its subsequent fees too lightly.

Interest Rates

Your interest rate, depending on the card you carry and your credit approval, most likely runs somewhere between 12% and 23%. Interest can really add up on purchases alone, so considering that a cash advance can carry an even higher interest rate, you will want to keep this in mind. Assuming you pay off your entire balance by the due date, the interest can still take up a good portion of your balance due. If you only pay the minimum balance each month, it can add up even more. It’s important to be confident that you can pay back the amount of the cash advance along with your additional credit card activity, including the interest. In the end, you could wind up paying a lot more in interest than the sum total of the rest of your balance.

ATM Fees

You also need to know that when you go to the ATM to withdraw that money, the bank who owns the ATM will also be making some money off of your transaction. ATM fees can run $2-$4 per transaction and there is the rare ATM that even charges $5. Still, you want to be aware of the additional fees that you will be incurring, as this will show on your credit card statement, adding to the balance you will be responsible for paying back.

In conclusion, no, credit card cash advances are not a bad idea. They are a great and convenient source of funding when most needed. However, one should approach them responsibly, knowing they can pay back the balance and not overusing the privilege.

Merchant Charge Card or A Credit Card?

Choosing Credit Card

It is a common misconception that a charge card is the same things as a credit card. Charge cards are typically issued specifically by stores and merchants for exclusive use in their stores or by some groups who offer a card that allows you to “charge it” at a limited number of participating merchants. Typically, you have to pay off the balance every month, although some do allow you to pay your balance over a period of time. Charge cards do not equate to an extension of credit, though you do usually have to have a pretty good credit score to get one. Credit is similar to a cash loan, you have to pay it back with interest and fees, however, it can be used almost anywhere. Charge cards do not offer the ability to  use them wherever you wish or to obtain cash advances and other company products, and while they sometimes come with the rewards and perks, they are not the same as those offered by many of today’s credit cards.

Charge Cards

While there are some charge cards that fit into a category that is neither store specific, nor really a credit card, for this particular discussion, the focus is on those cards issued through merchants themselves. The merchants issuing the cards typically have their own financial department or have partnered with a financial institution to issue the cards. The approval procedure is much like that of a credit card. Your credit will be checked and based on their terms and conditions, they will decide whether or not to issue a charge card to you.

A store charge card limits you to purchases at a particular store and its branch merchants, including  being limited to their merchandise offerings and prices. However, if you shop frequently or exclusively at one or two stores, a store charge card might be right for you.

Credit Cards

Credit cards offer many customer perks and benefits and greater flexibility than a store card. You can use it at a variety of places, earn rewards, points, cash back, etc. You are privileged to other products within your credit company’s line and can obtain cash advances from ATMs and cash back at point-of-sale. The APR and fees are typically lower than that of merchant charge cards as well. Credit cards allow you to shop  online and to pay your bills, where as a store card will only let you shop from their website, if they have one, and certainly will not help to pay your living expenses.

Ultimately, it is up to you to decide what suits you best. However, for those searching for greater flexibility in their spending, a credit card might be the better choice.

Bankruptcy and Credit Card Debt

Credit Card Debt

For those who have fallen head over heels into debt and can find no other way out, bankruptcy can really be the light at the end of the tunnel. Unfortunately, many people have abused the bankruptcy system over the years, using it as the easy way out from under the consequences of financial irresponsibility. Much of this irresponsibility includes massive credit card debt, and because the bankruptcy courts have allowed so much of this credit card debt to be discharged and go unpaid, it has hit the credit card companies right where it hurts – in their own pocket books, so to speak.

When a credit card is issued, the issuer becomes a lender  who has, in fact, loaned out a sum of money equivalent to the credit limit on the card. When credit card debts go unpaid, the credit card company suffers a financial blow because they still have to pay the vendors who accepted your credit card for payment.

With the rise in bankruptcy filings, especially due to the poor economy, credit card companies are fighting hard to get some of this consumer debt repaid and avoid suffering the mass financial losses that the bankruptcy courts have enabled.

Reform Not Working

The credit card companies put out a lot of time, money and energy to get a bill passed that would push for reform in bankruptcy laws regarding credit cards. Unfortunately, it’s not working out the way they had hoped. The idea was to push more filers toward repayment plans rather than discharging the credit card debt altogether. Unfortunately, even the best laid plans don’t always work out. Bankruptcy filings continue to surge and few consumers are in the financial position to repay the debt, resulting in more discharged debt, rather than the hoped for repayments.

Ramifications for Both Consumers and Credit Card Companies

Even if the new law starts to work somewhat, it is doubtful that credit card companies will see much improvement in their bottom lines. Consumers can not be forced into filing one kind of bankruptcy over another. While it is at the courts discretion to discharge or reorganize certain debts for repayment, the determining factor is the consumer’s ability to pay. If they can’t pay, well, they can’t pay. In that case, the court is still likely to discharge the debt.

Many credit card companies have warned that their charge-off rates are bound to rise, and when they do, consumers are bound to see higher rates reflected in their credit card statements.

A Brief Introduction to Credit Cards

Introduction

Having a credit card is a wonderful privilege typically extended to those who have proven themselves responsible and able to pay what they owe in a timely manner. If used responsibly, a credit card can be a real financial asset. Many people are afraid of credit card debt or can’t see why having a credit card might be important. However, there are plenty of reasons why credit cards are so great.

Improving and Maintaining Your Credit Score

By using a credit card and keeping your balance paid, the issuing bank will report your activity to the major credit bureaus. Of course, they do this, whether your credit with them is good or bad, but if you keep your debt paid down, this will be reflected in your credit score. A good credit score will open the door to other opportunities, such as lower interest rates on a big purchase, loans and even a mortgage to get into that lovely home you’ve been dreaming about.

Convenience

When you’re running short of cash or just don’t have the time to run right out to the bank, credit cards offer a convenient way to make your purchases, pay your bills and even shop online. Sure, you will have to pay a small finance charge and some interest, but that’s a minor thing compared to having to go without something you need just because you’re a little short on the greenbacks. You can see to it that your bills are paid on  time by using plastic and then pay off your credit card balance in one convenient payment every month.

Emergencies

There’s nothing like an emergency to throw everything off balance. Why add insult  to injury with added cash worries? emergencies tend to creep up at the most inconvenient times, and few of us have the time to worry about having the cash on hand to handle the situation. Having a credit card is a terrific solution. You can get that repair or fly out of town or solve most any issue requiring you to spend money in a pinch quickly and easily with your credit card. So long as you keep the balance paid down, you can rely on your card to bring you financial peace of mind in the worst of emergencies.

Cash Advances

Should you have a need for cash, especially in instances where plastic just isn’t accepted, and it’s just too inconvenient to run to the bank, your credit card can often be a source for cash advances from any ATM. Many people and businesses are turning away from the use of personal checks and payday loans because they involve so much hassle,  and when cash is not right there on hand, your credit card can come to the rescue. Then you just have to make sure the balance is paid so you always have this option when you need it most.

Yes, a credit card can be a very good thing to have. Use it wisely, and it will always be there to alleviate those unexpected and inconvenient expense worries in your time of need.

Which Credit Card is Right for You?

Choosing Credit Card

Once upon a time, credit cards were simple. A plastic card that allowed you to “charge it,” pay off the debt later with a few added fees, and that was that. Our fast paced world thrives on technology and options. Many cards now come with features and perks that make them more enticing to the consumer. Credit cards have become a competitive market where the idea is to gain and keep the customer through great rates, reward programs and more. However, it’s still up to the consumer to decide which credit card fits both their needs and wants. So, exactly what kind of options do you have?

There is, of course, the most common option of the standard credit card. These are unsecured cards offered by most any bank or financial company that issues credit cards. The APR on these varies from issuer to issuer. Standard credit cards include balance transfer cards, which allow the cardholder to transfer the balance owed on a high interest card onto a lower interest card. Another type of standard credit card is the low-interest rate card. This might be a card that offers a lower introductory rate and then increase after a period of time or a low fixed-rate APR.

Credit Cards with Incentives

Many credit cards these days offer perks and rewards just for using them. If you frequently use your credit card, this might be the best option for you. By simply using your card for purchases, travel, etc. and keeping your balance paid,  you can earn rewards, points and even cash to use for future purchases and other things. Talk about customer appreciation! It’s really a nice perk for credit card holders.

There are several different kinds of rewards programs, so you will want to explore the options and decide which suits you most. Cash Back credit cards reward you by allowing you to earn cash on eligible purchases. Everyone loves cash, so this is a popular incentive. These cards only offer a small percentage back on purchases and may take time to add up. They also typically have an annual fee of $50 to $100. However, if your faithful about paying your balance and using your card, it can be well worth it. Some credit card companies are also offering a similar incentive with their savings account program. They will deposit so much per transaction into a high yield savings account.

Points cards offer the cardholder a chance to earn points on their purchases. After accumulating so many points, they can be redeemed for specific items. The promotions and conditions are subject to change, so be sure to stay up-to-date on the fine print. some of these cards will have an annual fee, while others do not. There are also specific points, rebate and rewards programs for travel such as airfare (frequent flier programs) and hotels, retailers, and gasoline purchases. There are other points programs out there, but these are among the most common and most popular offerings.

Credit Cards To Repair Your Credit?

Yes, there are also credit cards made for those with bad credit and in need of credit repair. Some of the best options among these are secured credit cards, which usually require an application fee, an initial deposit equal to or greater than the credit on the card, and a low credit limit. These will allow you to use the card and make payments, helping to repair your credit rating. Another good option is a pre-paid credit card. It’s a lot like a gift card or a debit card, however, you can use it anywhere and don;t run the risk of going over your limit or going into debt because you load the money onto it and you control the spending.

There are also credit cards geared toward businesses and students, so if you fit the bill, you might look into these options.

A credit card can be a great asset to have, however, terms, conditions and rates will vary between card companies, so be sure to read the fine print so you will know what you’re getting and what to expect.

Credit Card Fraud and Identity Theft

Identity Theft

Credit card fraud and identity theft are serious crimes that have become quite prevalent in the United States. It’s a sad, unfortunate shame, and while little can be done to stop it, aside from prosecution once the damage is done and the perpetrator found, there is plenty one can do to protect themselves.

Identity Theft

Few other countries have as big a problem with this, as they do not use the system of social security numbers that we use in this country. This number, which we are warned to keep private, is readily available to anyone looking for it, simply because we are asked to use this as a standard form of secondary I.D. on just about every form and application we fill out, among other things. A person who is up to no good, can steal your identity, take over your life and do with it as they please, leaving you to pick up the pieces later on.

Credit Card Fraud

Credit card fraud in itself does not constitute identity theft. Still, the idea that some dishonest thieving individual has your card or number and is racking up charge after charge is still unsettling and can disrupt your life as much as identity theft can. It can be very difficult to try and get those charges off your bill and your back and to get everything back under your own control so that no one is using your account for their ill-gotten gains. Luckily, there are laws that protect honest citizens from this kind of thing. Still, once again, the damage is already done by the time prosecution occurs.

Beating Thieves at Their Game

Follow all the steps recommended for protecting yourself from identity theft. Shred those personal documents, don’t give out personal info over the phone or to unknown persons, keep your social security card protected and in a place where no one else can access it, etc. You can find many tips and tricks to protect yourself from identity theft by doing an internet search. The best resources will be from government entities, such as the FTC.

To safeguard yourself from credit card thieves, do the following:

• Check your billing statements closely every month and report any fishy activity immediately.
• Be responsible with your credit card. Don’t loan it out, and don’t leave it where someone could gain access to it without your knowing.
• Should your card come up missing for any reason, report it immediately.
• If you don’t intend to use a credit card, cancel the account and shred that card.
• Sign yourself up for e-mail alerts on card activity. Should someone have your card or number in hand, you’ll know it sooner and can take action fast.
• Use of the CVV (the little 3-digit number on the back of your card) is a good security measure. Many websites ask for this verification code to prove that you do, in fact have the card. The downfall? If someone else has your card, they have the CVV, and once you enter the CVV into a website or use it to verify some other purchase, well… anyone with access to the purchase info who also has shady intentions now has both your card number and CVV. There is a new piece of technology to the rescue, however. This handy little gadget, usually attached to your key chain, will randomly choose a new number every few seconds, based on certain factors, to act as your CVV for any given purchase. This is a great investment if you’re looking to protect yourself.

While you certainly cannot single-handedly put and end to credit card fraud and identity theft, you still have plenty of options for protecting yourself. Be proactive and don’t tolerate thieves who want to take advantage of your good name!