Credit Card Quick

Golden Rules for Debt Management

Credit Card Debt

Debt management shouldn’t be a confusing subject yet, for many of us, we make it more complicated than it has to be. The goal is quite simple, actually: don’t spend more than you make.

Sure, this sounds like a no-brainer. And, if this were the only thing we had to worry about, there would be very few problems. Unfortunately, however, debt management is not that simple.

With that said, there are a few, golden rules of debt management that we could all benefit from sticking to:

• Many of us don’t want to face the mounting credit card bills in the corner, so we do our best to ignore them. This, however, is only a temporary fix, at best. The best solution is to take a deep breath and assess your debt situation. The basic fact is that ignoring them won’t make them go away. Realization and acknowledgment of our debts is, by far, the best way to get a handle on our debts.
• The next golden rule of debt management is to simply stop spending so much. Sure, this is easier said than done, but the fact of the matter is that most of simply don’t pay attention to our spending habits. This act, of course, is easy to do, considering that many of our purchases end up on credit cards, where we often forget about them. Pay close attention to your spending habits and gather all receipts together so that you can review your purchases on a weekly basis.
• If spending has become a problem for you, don’t wait to get help and change things. Your debt problems don’t have to be your problems alone. There are many resources available that can help you understand why your spending is out of control and can help you make the necessary changes so that you won’t be burdened by debt. A good source for debt management assistance is non-profit credit counseling agencies. Before choosing a credit counseling agency, however, check their credentials and background to make sure they are reputable and trustworthy.

Are your Credit Cards Stressing you Out?

Introduction

If you seem to stress out every month the credit card bill arrives, and you stash it under the other bills, avoiding it as long as possible, you could very well be suffering from credit card burnout.

However, it is unlikely the credit card itself is a source of your stress; instead, it is likely how you are handling your credit card that is the problem.

If you want to de-stress yourself from your credit card troubles, and you don’t want to abandon them altogether because you understand their worth, there are a few ways in which you can begin to enjoy a healthy relationship with your credit cards, and your finances in general:

• If you have more than handful of credit cards and you find managing them every month is a chore, it may be time to pare down your credit card collection. In particular, consider ridding yourself of retail credit cards, which generally come with hefty interest rates and fees and instead choose a major credit card with a competitive, fixed rate on which to make your purchases. Consider, too, that possessing too many credit cards can result in you forgetting payments, which could ultimately damage your credit.
• Use your credit card for good! Yes, it may sound like an odd concept, but the reality is that credit cards can offer you great insight regarding your monthly spending habits. Use your credit card to make everyday purchases, from groceries to clothing and birthday gifts, and you can soon begin to see spending patterns when you examine your monthly credit card statement. With awareness comes knowledge and knowledge can propel you to make the necessary changes to better manage your finances.
• If your spending habits are out of control or not in line with your priorities or goals then use this information to make important changes in your life. Once you begin to understand the importance of mindful spending, credit cards can no longer overwhelm you. In fact, once you have mastered the art of responsible spending and budgeting, you may actually begin to look forward to opening your credit card statement each month!

Credit Cards and Marriage: Getting started Right

Introduction

If you are getting married soon, chances are you and your spouse will each come into the marriage with your own set of bills; and that includes credit card bills. In order to start your life out on the right foot, you and your spouse will need to be on the same page when it comes to finances; and to do that you need to remain open and honest with one another.

Here’s what you and your spouse, or soon-to-be-spouse, may want to discuss:

• Order copies of your credit reports – There is no better way to start a marriage than by laying everything out on the table. Regardless of the financial mistakes you or your spouse made in the past, it is best to begin your life together with complete knowledge of where you stand financially. Agree not to judge each other; just concentrate on your goals moving forward.
• Consider consolidating debt or paying it off – One of the best things you can do before you even think about any other financial decisions is to pay off outstanding credit card bills that either you or your spouse currently possess. Paying off debt, especially high-interest credit card debt, will free up your household budget so that you can move forward and work together to save money and create savings.

In addition, if you or your spouse have a great credit card with a low interest rate, consider transferring your other credit cards to just this one card.

• Consider opening a joint credit card account instead of carrying separate accounts. A joint account will allow you and your spouse to keep better track of your household spending and work together to pay the bill each month. This is also a good way for both you and your spouse to stay better informed regarding your credit card debt.
• Choose the card that’s best for you – Consider your options regarding credit cards, and decide on a card that will benefit both you and your household. For example, you may want a low-interest, no-frills credit card or one that comes with attractive rewards.

How Best to Approach your Partner about your Household’s Credit Card Debt

Credit Card Debt

You may have a good idea about how to budget your income and pay off your credit card bills; but your spouse or partner may not be on board.

In order to make the most out of your income and live without mountains of credit card debt, it only makes sense that both partners must find a compromise between what is spent and what is paid each month.

If you have a spouse or partner who is unwilling to go the distance to get your credit card debt in check, then it may be time to be a bit more creative when it comes to negotiations.

1. Don’t approach the conversation in attack mode. If your partner feels that he/she is being attacked or accused of accumulating the bulk of the credit card debt, he/she will certainly react by becoming defensive. Instead, approach the conversation using “we.” For example, “We should come up with a game plan for reducing our credit card debt so we can begin saving for a home.”
2. Include your partner in on the discussion. Instead of approaching your partner with all the answers, encourage him or her to become actively involved with finding a solution. You can certainly come with a list of ideas or suggestions; just avoid being the one with all the answers.
3. Sweeten the pot with a little incentive. You may try something like: “we could begin to put money aside for that Caribbean cruise if we just pay off this credit card debt first.” Having something to look forward is often a good incentive for paying off credit card debt.
4. Put it in writing so there are no misunderstandings or miscommunication. Detail clearly what is expected of each of you so that there won’t be any problems down the road. If you are both income earners, detail what portion of each paycheck should go to paying off the debt. You may also want to discuss the ways in which you can begin cutting back on your spending. But, once again, make sure you approach this conservation in a calm, non-confrontational manner so that you can better accomplish your overall goal of living debt-free.

All Credit Card Consolidation is not Created Equal

Credit Repair

You hear it all the time: credit card consolidation is the way to go. And, based on your mountain of credit card bills, credit card consolidation looks pretty darn good right now.

But what credit card consolidation programs are the best for you?

Often the easiest way to consolidate your credit cards is through a balance transfer offer from another credit card. However, it is important to realize that, although they may all seem alike upon first glance, they are, in fact, quite different according to their terms and conditions.

In order to determine if credit card consolidation is right for you, and to determine if you are getting a competitive rate on a balance transfer offer, you may want to begin by:

• Assemble all of your credit card debt. The best thing you can do, first and foremost, is to assess your credit card situation. Add all of your credit card debt up and determine your interest rate and minimum payment on each card. Then, add all payments together and compare it with current credit card consolidation offers. Make sure the offer is worth your while. For example, it certainly doesn’t make much sense to consolidate your debt if you won’t save on interest.
• Don’t just take one credit card consolidation offer and run with it. Instead, eye up the competition and check their interest rates, promotional rates, balance transfer fees and other related fees.
• Regardless of your decision, make a promise to repay your credit card debt in a reasonable amount of time and with a serious game plan. You can repay your credit card debt without consolidating your debt onto a balance transfer offer, but it may make sense to consolidate debt merely for the convenience of paying just one payment each month.
• Develop a game plan once your credit card debt is paid off. Many people, once their credit card debt is paid off, will simply recharge on their credit cards, thereby creating the same problem all over again. If you need to cut up your credit cards, then by all means so do. If you need to take them out of your purse or wallet, then make the move before your credit card debt becomes a problem once again.

How to Cope with your Holiday Credit Card Bills

Credit Card Debt

You swear you wouldn’t do it, but here you are again, looking at your pile of holiday bills and grimacing at the thought of repaying your debts.

Don’t let your holiday bills bog you down all year long. Take care of them now so that you can begin enjoying a debt-free 2010.

The following tips will help you formulate a plan to pay off your holiday bills:

• Carefully review all of your credit card bills – Because there is likely a lot of activity on your credit cards from the holidays, you will want to thoroughly examine all of the charges on your credit card statements. It is not uncommon to spot errors, so the earlier you catch them, the better.
• Assemble all of your credit card statements and write down the balances, the minimum payment amounts and the interest rates on all of your cards – The general rule of thumb is to concentrate on the credit card with the highest interest rate first, so consider something like this: pay the minimum payment on all of your credit cards, with the exception of the credit card with the highest interest rate, as you will want to put as much money as possible onto this card until it is paid off. Then, do the same thing with the rest of your credit cards.
• If you have strong credit, consider consolidating all of your holiday credit card bills onto one, low-interest credit card. Pay close attention, though to the terms of the balance transfer offer, and check out the balance transfer fee.
• If you find yourself drowning in credit card debt, don’t wait to seek help. Instead, find a reputable, non-profit consumer credit counseling service. These organizations can help negotiate lower rates and more reasonable repayment terms, particularly if you are struggling to simply pay the minimum payments on your credit cards.

Smart Holiday Spending

Credit Card Debt

You don’t have to spend the better part of the new year stressing over bulging credit card balances and high interest rates!

Called “holiday hangover,” it is the time of the year that many consumers cringe when they open their credit card bills. Too much debt and not enough cash means that credit card balances go nowhere while interest rates and fees continue to mount.

This is the year that you can change this, though. Instead of digging yourself into debt this holiday season, change your attitude toward holiday spending and instead spend smart to save yourself from a “holiday hangover” in 2010.

How to Keep your Credit Card Spending in Check this Year:

• Understand retailers’ tricks and be prepared to reject them. It is not uncommon to be inundated with credit card offers every time you walk into your favorite retailer. Although these enticements can be tempting, keep in mind that most retailers charge much, much more in interest charges than major credit cards. The bottom line: you will likely end up spending more in interest charges with retail credit cards, regardless of whether you take advantage of a promotional rate.
• Take your credit card out of your wallet unless you make a planned purchase. Impulse spending is the weak spot of many consumers. You’re out and about when you notice something that you didn’t think you need, but now you can’t live without. Sound familiar? For most consumers, this type of spending is dangerous and all too common. Your best bet is to simply leave the credit card at home until you are ready to make a purchase.
• Make a budget and stick to it. If you do your homework and set a strict budget for all the people on your list you are far less likely to go overboard with purchases, and far less likely to charge up your credit cards.
• Determine your ability to pay off your debt before you make a purchase. If you want to make a credit card purchase, but you know you don’t have the money to pay it off in full next month, sit down and calculate the interest you will be paying. Often times, this bit of reality is enough to make you think twice about hefty purchases.
• Choose the best credit card and put away the rest. You don’t need to use all of your credit cards, and you really shouldn’t. Instead, take the time to compare the rates and terms on your credit cards and use only the card with the best terms and conditions.

Should you put up with Credit Card Annual Fees?

Choosing Credit Card

Many credit card companies are getting quite creative when it comes to socking customers with fees. Case point: there are a few credit card companies that are now kicking around the idea of reinstating annual fees. During the height of the credit boom, most creditors threw annual fees out of the window. Now, however, they seem to be singing quite a different tune.

The question is: should you pay an annual fee for your credit card?

If you have good credit and you’ve proven yourself to be a good credit card customer, then absolutely not. As consumers, there are certain things that we will inevitability have to put up with, given the state of the economy and the pitiful state of the credit card industry. However, annual fees shouldn’t be one of them.

Who wants to pay their creditor for the privilege of spending their own money? I certainly don’t, and neither do most consumers.

Testing out Annual Fees

There are many reports that credit card companies are now in the process of “testing out” annual fees for their credit cards, which means that if enough consumers complain about this unnecessary fee then most companies will ditch their annual fees and leave them in the trash, where they need to remain.

Bank of America, for example, recently announced that it would start to “test” annual fees for its customers, and charge a select group of customers an annual fee of anywhere from $29 to $99, although it isn’t clear how they will decide which customers pay the lower fee and which customers will be charged the higher fee, and if there are any fees in between.

When you may not Have an Option

There is, perhaps, one occasion that you should simply pay the annual fee and quietly go on your way. If you have poor credit or have been unable to pay your credit card bills in a timely fashion then you probably don’t have a whole lot of options when it comes to annual fees. In other words, if you dispute your annual fee, your creditor may very well tell you that you must pay the fee or risk losing the card.

Your best bet, as a credit card customer, is to simply contact the creditor and request that the annual fee be removed from your account. Some companies will comply, particularly if you have proven yourself to be a good customer, while others will stick to their guns.

Your Options when you Simply Can’t Afford your Credit Card Payments

Credit Card Debt

During these difficult financial times many individuals across the country are struggling to pay their credit card bills. With rising interest rates and tighter credit restrictions, many of us have found ourselves caught in a serious situation where our income simply can’t be stretched any farther.

Combine that with job losses and layoffs, and it becomes quite clear why so many Americans are struggling to make their credit card payments.

If you simply can’t afford your credit card payments, know that you do have options:

• Contact your lenders and explain your situation. If you recently lost your job or were laid off you can always request that your lender waive your fees, lower your monthly payment or set up some kind of payment plan that will allow you to better manage your debt. Persistence is key when it comes to negotiating new terms with your credit card company. Ask questions and demand to talk to a manager or supervisor if you are having no luck working out alternate arrangements.
• Consider debt forgiveness. If you have no means of paying your entire debt, you can often negotiate debt forgiveness. Debt forgiveness involves paying off your credit card for less than you owe. For example, if your credit card debt is $10,000, your credit card company may forgive half of your debt, thereby allowing you to pay off just $5,000 of that debt. However, it is important to understand that the debt forgiven will be reported to the IRS as taxable income. In other words, that $5,000 worth of forgiven debt will be taxed come tax time.
• Consider debt consolidation. If your credit is still strong, and you recognize impending trouble, you may be able to consolidate your credit card debt into one, easily manageable monthly payment.  You may be able to consolidate onto another credit card, or take out a personal loan to accomplish this. Reconsider using your home’s equity to consolidate this debt, though, as your inability to repay your loan could cost you your home.

How to Deal with a Credit Card Debt Collector

Credit Card Debt

For many of people, the tough housing market and credit crisis has taken its toll. If you’ve lost your job, been sidelined with an exploding mortgage payment or have simply been unable to earn as much money because of the poor economy, then you may have had difficulty handling your credit card bills.

Your creditors may turn to a debt collector when you have been unable to meet your credit card payment obligations for at least a month or more. Debt collectors, whether they work for the creditor or through a third-party collection agency, are paid to collect past-due money.

However, there are a set of guidelines to which they must adhere, and a set of rights that you, as a consumer, should be aware of if a debt collector has begun calling:

• Be aware of the Fair Debt Collection Practices Act. The Fair Debt Collection Practices Act is a federal act set forth to protect consumers from abusive collection practices. If you feel that the debt collector is engaging in abusive or harassing practices, or does not exhibit fair treatment or respect your privacy, then you have the legal right to make them stop harassing you. You may want to check with your state regarding their standards and laws for debt collectors, as well.

For example, a debt collector can not make threats against you, and cannot use abusive or profane language. A debt collector also cannot discuss your personal account information with any third parties or call you at unreasonable hours.

• Once a creditor or debt collection agency has begun calling you, don’t ignore the phone calls. Instead, ask for all pertinent information from the creditor, including their name, address, and telephone and fax number, as well as the specifics about your debt. You can also ask them to not call you at work and to also contact you only by mail – the creditor has a legal obligation to abide by your wishes.
• Keep a file regarding all of the information received by the debt collector, as well as times and dates (and copies, if possible) of all voice mails or phone messages left by the creditor. You may also take notes of your conversations with the debt collector. Most importantly, keep copious notes of any abusive or harassing behavior in case you need to contact the authorities.
• Seek assistance from an accredited consumer counseling agency to help you manage your debts. The best way to deal with creditors is to handle your debts so that they stop contacting you; and to do this, you need to take care of your financial responsibilities, which may mean seeking the assistance of a consumer credit counseling service or bankruptcy attorney.