Credit Card Quick

How to Avoid the Pitfalls of Credit Card Debt

Credit Card Debt

Think of your credit card as an opportunity to prove your credit worthiness. Your credit card is your chance to build a strong credit history so that you can enjoy all of the benefits that come with a strong credit score.

Here are some tips for preventing the pitfalls of credit cards that so many consumers have found themselves in:

• Find the credit card that is right for you – Instead of choosing a card because of rewards or introductory rates, concentrate on the basics of the credit card, including the APR and the annual fee. Your ability to build a strong credit history relies on your ability to pay your card on time and pay it off in a reasonable amount of time. It is therefore imperative that you find a card with only the most competitive rate and terms.
• Understand your card’s terms and conditions – Your card’s terms and conditions are likely to change because of the new credit card legislation, so it is more important than ever to pay close attention to any and all changes relating to your credit card’s terms and conditions. It is ultimately up to you to understand your credit card and all of the rules and regulations that go along with it.
• Know your credit card’s APR and pay close attention to any changes –Always pay close attention to your credit card’s APR. In fact, it is a good idea to take note of the APR every time you receive your credit card statement. Although credit card companies must provide you with at least a 45 day notice of any changes to your card’s APR, you may miss this disclosure. It is therefore always a good idea to take note of your card’s APR.
• If your card isn’t working for you, don’t be reluctant to find another card that will work for you. You must remain in charge of your financial well being, and that includes taking charge of your credit card. If you don’t feel as if your credit card is giving you the most competitive rate and terms, then by all means find another card that will.

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.

The Three Easiest Ways to get into Credit Card Debt

Credit Card Debt

There are certain life situations that result in credit card debt. We do our best to keep our credit card debt at bay, but there are times when credit card debt can sneak up on us when we are least expecting it.

Don’t let life situations catch you off guard and end up costing you big in the form of credit card finance charges. Instead, make it a point to plan ahead and prepare for those changes in life that can cause our finances to spin out of control.

When you are likely to get into Credit Card Debt:

• When you have a baby – Having a baby is no doubt a huge strain on any family’s finances, especially when a couple who normally lives off two salaries is not cut down to one for a specific length of time. The easiest way to plan for a new baby – and save yourself from credit card debt in the process – is to begin the task of budgeting long before the baby arrives. For example, if you know that you or your spouse will be taking time off from work to care for the baby, or if you or your spouse is even considering quitting your job to care for the baby full-time, you must understand that this can take a huge toll on your ability to budget your household. Your best bet is to begin saving as much money as possible ahead of time and to start living as if you are without a salary. That way you can begin deciding where you need to cut back and save so you are better prepared when the special time comes.
• When you change jobs – Changing jobs can be both a positive and negative financial experience. Many individuals must take a pay cut to move to a more desirable job, while others begin spending more because they are earning more. Either way, your finances can be thrown for a loop when you change jobs. To keep yourself out of credit card debt during this transitional time, remember to stick to your budget and cut down on your discretionary spending until you have settled into your new position.
• When you remodel your home – Remodeling your home is a tricky process that can often quickly spin out of control. Many remodeling projects go way beyond the projected budget, leaving homeowners little choice but to charge a good portion of the project just to get it completed. To avoid this, make a detailed budget and stick to it! Be realistic and budget for surprises or additional expenses, and revisit your budget and where you stand throughout the project as to avoid any surprises.

Credit Repair Companies: Why you shouldn’t have to Pay for Repairing your Credit

Credit Repair

The tough economic conditions this past year have left millions of consumers in financial straits. From the effects of the recession and credit industry to the tumbling housing market, credit card consumers across the country are finding it difficult to keep up with their credit card payments and are slowly destroying their credit in the process.

If you have been a victim of the economy and you are drowning in a sea of credit card debt, you may be tempted to contact one of those credit repair companies you often see advertising on television, radio and even on billboards. They often offer to repair your credit so that you can get approved for a car loan, a home loan or personal credit.

It may sound quite tempting, actually. The thought of paying a company to pull a quick fix on your credit may just solve a host of problems. But before you jump into the arms of one of these credit repair companies, there are a few things you should consider:

•  No one can legally remove information from your credit report. Regardless of what these companies may promise you, it is simply illegal to have any information removed – unless, of course, you find an error or discrepancy, in which case you must request an investigation by the appropriate credit bureau.

•  The only thing that will remove your bad credit rating is time – and responsible credit behavior.  Your negative credit card information can only be reported for seven years (bankruptcy is ten years). Unpaid judgments go back seven years, or until the statute of limitations ends.

•  Improving your credit score can only be accomplished one way: paying off your debt. In other words, instead of trying to hide from your creditors, contact them and set up a reasonable payment plan, if possible. You will feel relieved to end the stress of avoiding the creditor, and you will immediately begin repairing your credit.

•  If you choose to contact a credit repair company, make sure you receive the brochure, “Consumer Credit File Rights under State and Federal Law.” This brochure should clearly outline the company’s fees, as well as your rights and obligations.

•  Consider seeking help through a non-profit consumer credit counseling service, which is almost always free of charge.

Post-Holiday Debt: How to Handle it so it doesn’t Haunt you all Year Long

Credit Card Debt

You swore you wouldn’t do it.

You swore you’d keep your spending in check this holiday season and lay off the credit cards. But here you are again: stuck with loads of credit card debt and equal parts post-holiday guilt.

Don’t give up hope just yet, though. The fact of the matter is that there are a few, simple ways to control your debt and spending and eliminate credit card debt so that it doesn’t rule your life.

The following tips will help get you started on a new, financially responsible 2010:

• Consolidate your debt – Often times, debt can seem all the more overwhelming and difficult to manage when you are struggling with numerous credit cards. Instead, consolidate your debt onto one credit card with a competitive interest rate and a fair balance transfer offer.
• Pay more than your minimum payment – Simply put, your credit card balances can go nowhere if you continue to pay just the minimum payment. Find at least a few extra dollars each month in your budget and put it towards your credit card bill – your balance will thank you for it.
• Order a copy of your credit report – You can’t begin to move forward until you clear up your financial past. Order a copy of your credit report from all three major credit reporting agencies (you are entitled to one free copy each year) and take the time to thoroughly check them out so you can move forward with your financial plan.
• Cancel any retail credit cards – Retail credit cards are often an invitation for financial trouble. Too much temptation combined with high interest rates often spells trouble for credit card consumers.
• Consider a home equity loan – If you have equity in your home, consider using it to your advantage and use it to pay off your credit card debt. However, if you don’t change your spending habits, you will likely end up in the same situation in the upcoming year.
• Make a budget and stick to it – Which leads me to the last tip: make a budget and stick to it. The bottom line is that if you don’t make a point to change your spending habits and your view on finances, you will likely find yourself in the same financial mess as you are in right now. If your finances and credit card debt are more than you can handle, consider speaking with a non-profit consumer credit counseling service.

How to Start your New Year Financial Resolutions

Introduction

Individual stock funds continue to rise; the housing market finally hit bottom; and market volatility has finally stabilized. Whew.

It is important to understand that, although 2009 was a year of uncertainty and change, in just about every aspect of our economy and nation, there was plenty to learn from. Now is the time to take that knowledge and move forward so that you can build a better financial future.

So, 2009 wasn’t all bad news.

With that said, now may be the perfect time to begin your New Year financial resolutions. Here are some resolutions to start with:

• I will work towards erasing my credit card debt – For many individuals, credit card debt still remains an all-consuming headache. Make 2010 your year to erase your credit card debt so that you can use your money to get ahead financially instead of pay interest on credit cards. Make a budget, find extra money in your budget and make a game plan to pay off your credit card debt.

Make a list of all your credit card debt, including their interest rates and balances. Then, work towards paying off your highest interest rate debt first and working your way down the list. Find ways to save money; eat out less; cut down on your cable bill and clip coupons for groceries. You’d be surprised to find out how much money you can save each and every month!

• I will learn from my past financial mistakes – We all need to learn from our mistakes, and that goes for financial mistakes, too. Don’t beat yourself up for past financial mistakes; instead, use your knowledge to move forward and create a strong financial future. Your first New Year’s financial resolution can be to move forward and learn from your mistakes!
• I will work towards a long-term financial strategy – Your credit card and financial strategy cannot be complete without looking forward to your long-term financial strategy. Revisit your retirement funds, long-term care policies and life insurance policies to ensure that you are protected financially, both now and in the future.

Easy Ways to Manage your Household Budget to Avoid Credit Card Debt

Credit Card Debt

Many of us, at one time or another, have found ourselves short on money and our paychecks remain days – or weeks – away. Overspending can result in high credit card debt; something that we all want to avoid.

Instead of using credit cards to make ends meet, make a household budget to better manage your money. Luckily, there are easy ways to get a grip on your budget so you can save your credit card purchases to only those that you can afford to pay back:

• List all of your expenses, even the most insignificant – The best place to start when making a budget is with a list of expenses. Account for every expense – even the cup of coffee you purchase every morning on the way to work – otherwise you won’t have a clear picture of where your money goes every month. From gasoline and groceries to clothing, entertainment and utilities, make a comprehensive list and go from there.
• Be realistic about your monthly expenditures – You can’t make a budget if you aren’t honest with yourself. If you make a restrictive budget that is simply not realistic you cannot expect to keep it. Be honest about your budget so you can better manage your expenses.
• Pay your bills –and yourself – first – Don’t spend a penny until you have taken care of your obligations, which should include your bills and your savings and retirement accounts. Many individuals make the mistake of spending elsewhere before obligations have been met, which surely leaves them in a bind when it comes time to paying bills. Paying your bills on time, which includes your credit card bills, is incredibly important for maintaining your credit score and credit standing, which thereby saves you money from late payments, high interest rates and an overabundance of debt.
• Better manage your monthly bills with online bill paying – If you are having difficulty balancing your checkbook or getting checks written and sent in time then you may be able to benefit from the convenience of online bill paying. Online bill payment systems, which are often available through your bank, allow you to better manage your money by paying your bills on time and by providing you with a current account balance at any given time.

What to do when you can’t Afford to Pay your Credit Card Bill

Credit Repair

If you find yourself in the difficult situation of not being able to pay even the minimum payment on your credit card, there are a number of things you can do – and ignoring the problem is not one of them.

Many of us, in the midst of financial despair, may choose to ignore the creditor phone calls and letters; but this simply doesn’t solve anything. Instead, face the problem head-on and figure out what you can do today to get out credit card debt tomorrow.

• Sit down and make a budget. Not just a general budget, but a detailed budget that accounts for every penny going in and out of your household each month. Examine your monthly expenses and look for ways to cut back.

You may want to consider abandoning your land line if you have a great cell phone plan; you may want to drop your expanded cable television package for its basic counterpart; or you may want to make an effort to cut down on your grocery bill every month by clipping coupons and shopping sales. The bottom line is that most everyone can find an extra $50, $100 or more in their budget if they just take the time to re-examine their spending.

• If you’ve lost your job, make immediate, drastic cuts in your lifestyle. Don’t wait until you are behind on all your payments to start making changes. Immediately cut out all unnecessary expenditures and live lean until you can find another job and regain your financial footing.
• If you’re simply in over your head in credit card debt, and can’t seem to find a solution, you may want to consider contacting a non-profit, credit counseling service. These agencies can help you find ways to meet your financial obligations without getting bogged down by late payments and over-the-limit fees.
• If you find yourself struggling to make your minimum payment, you may be able to negotiate a lower, monthly payment with your creditor. Always remember that it never hurts to ask. Many creditors, aware of the financial problems of so many Americans, understand that it is in their best interest to help consumers find a solution to their credit card debt.

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.