Credit Card Fees That Will Bite You

We all know about annual membership fees, past due fees and overlimit fees, right? I hope so.

Few people though know about two fees many credit card companies charge: currency conversion fees and foreign transaction fees. They can be avoided. See this link to determine which card or cards you should carry if you're planning on traveling overseas.

LINK: http://news.yahoo.com/s/fool/20081117/bs_fool_fool/rx9729

Ridiculous Spending

We've all made impulsive spending decisions in the past, using credit cards too frequently at the mall, but some people just throw all regard for consequences (financial and otherwise) out the window.

View this list of most ridiculous credit card spending sprees. LINK: http://www.proquo.com/resources/ten_credit_card_sprees/

'Junk Mail Effect' Equals Emissions of 9 Million Cars, 7 US States Combined

The amount of mail going out to consumers and businesses is unreal. I've seen a drop in junk mail in my house, but the mail carrier will probably tell you that's not the norm. I've opted for electronic (online) statements and do my banking that way. (That's at least a savings of 10 or 12 stamps a month, plus the trip to the Post Office.)

Here's a site that help you cut down on junk mail: http://www.proquo.com/

Saving Money Over the Holidays

With the economy headed out of control and so many facing unemployment, I thought some of you might appreciate some favorite discount shopping sites this holiday season.

http://www.gottadeal.com/

http://www.dealtaker.com/

http://www.overstock.com/

http://www.buy.com/

One more suggestion, register your kids at http://www.upromise.com/ and any online shopping directed through their site (to these same outlets and a whole lot more) will not only collect money toward their college tuition, but will also provide you with discounts of up to another 10 percent.

Defend Your Credit Limit

Reeling from mortgage losses, banks are reducing credit card borrowing limits, even for some cardholders with good records. Factors that could lower the boom on you: a minor mess-up (being late on payments, even once), living in a high-foreclosure area and carrying other risky debt (such as an interest-only mortgage). A lower limit can push up your debt-to-credit ratio, which hurts your credit score.

You do have options if it happens to you. Consider one or several of these:
- Make an appeal to the credit card company.
- A computer may have cut your limit, but a customer service rep may be able to bring it back up.
- Bluff
- Threaten to cancel. Hurting for revenue, banks can't afford to lose good customers.
- Compromise
- Applying for a new credit card could hurt your score more than it helps. Instead, ask for a lower APR, which will make it easier to pay off you balance.

- From Money Magazine

Another Groovy Tool

Think your credit card debt is getting you into further trouble? You may consider curtailing your holiday shopping a bit this year, as the financial experts say many of will do this year. Yours truly will probably be in the same boat. We're all tightening our belts in wake of the near collapse of Wall Street. Don't get me started on my 401K. I'm still relatively young, so at least my near future contributions, which will remain at the same level, will buy MORE shares. More shares translates into more returns later. Am I right? I digress here.

What I was leading to is I stumbled across a credit card calculator online that will give you an idea of how long your debt will take to be paid off. (LINK: http://www.themoneyalert.com/CreditCardCalculator.html) A "friend" has a credit card charged up to $15,000. Yes, I think we all agree that's a lot on a piece of plastic, but he's making progress on it, paying at least $300 a month. The APR on this card is US Prime (current 5 percent). Yes, the "friend" has excellent credit. At last review, his FICO score was 755. Good thing for him.

Making minimum payments of $300/mo at Prime, if it remains at 5 percent, the person in this example can expect to pay $1595 in finance charges along the way, and the debt will be gone in 52 months. A quicker remedy, of course, might be a balance transfer offer to move the debt to a special (lower) rate. ATTENTION HERE: Read the fine print on those babies. Your incredible deal of 0 percent is usually an introductory teaser rate and may come with a transaction fee. The industry standard now is a 3 percent fee. It's hard to avoid that right now.

As we head into the holiday season and 2009, take some time to consider your financial situation and steps you may take to dig yourself out of debt and save money.

Tackling Credit Card Debt

Karen Gross likens excessive debt to a bad hangover. “The last thing you want to do is try to relieve your financial headache with a solution that will be worse than the hangover itself,” says Gross, the president of the Coalition for Consumer Bankruptcy Debtor Education (http://www.debtoreducation.org). Quick fixes rarely work, according to Gross, who offers the following four-step formula for getting on track.

1. Hold your horses, stay calm, and don’t rush into any impulsive arrangements. “Don’t panic,” Gross advises. “It’s essential to pause, take a deep breath, and look carefully at possible solutions.”

2. Examine your situation. While your debt problem may be serious and appear urgent, first get an accurate sense of the extent of your situation. Gross says: “Lots of organizations offer help, but don’t take the first solution that comes along. Take time to assess, compare, and contrast multiple solutions.”

3. List your options, including the pros and cons of each. For example, while a home-equity loan may seem like an appropriate solution, it’s not always the best course of action because it can put your home at risk.

4. Pay at least the minimum amounts due on all of your credit cards. This last step is critical because of the “universal default” clause, which permits a credit card company to raise your interest rate if you’re late on another company’s credit card or any other outstanding loan. Lenders argue that it’s logical to raise rates for a consumer who has shown evidence of becoming a greater risk. (Scott's note here: Not all credit card companies will raise your APRs if you've been bad on another bank card.)

Can You Afford It?

I love the Suzie Orman shows where she talks to listeners, reviews their financial situations and tells them whether they can afford to make a certain investment or purchase. (You're great Suzie!)

Unfortunately, too many of us move forward without any thought. Buy now (especially on plastic) and pay for it later. Isn't that what has delivered the country to its current state? For those who say we're not in a recession, I say you're full of bologna- and we're not talking Oscar Meyer.

Check out this link (http://www.hsh.com/calc-howmuch.html) for a mortgage calculator that will give you an estimate of how much you can afford. Always a good idea before you pull out of the apartment complex driveway in your 1989 Corolla and begin looking at million dollar homes. (This is especially true for those of you new to the Rat Race. And, BTW, welcome to the real world! LOL)

And FYI on top of that. For your sake, please pull your OWN credit bureau reports FREE OF CHARGE at http://www.annualcreditreport.com BEFORE you apply for a loan- mortgage or car note. You might save yourself some time and disappointment. Clear up any issues and then go shopping.

No More Credit Cards

Are the credit card companies blitzing you like there's no tomorrow? Are you worried about someone possibly stealing a credit card offer out of your mailbox? Would you rather just be "left alone" by the banks? There is a way to avoid it all.

Similar to the National Do Not Call Registry (http://www.donot-call.gov/), you can now eliminate the credit card offers from clogging your mailbox.You can contact them through a service run by the three major credit bureaus at http://www.optout-prescreen.com/ or call 888-567-8688.

You will need to key in your social security nuber and your date of birth. This will give you the option of removing your name from all lists for five years or permanently from prescreened offers that are sold to credit card companies.

Another option is to contact the credit card companies directly. If you get an offer in the mail and don't want to hear from that bank again, pick the phone and ask to opt out of solicitations or look for their privacy notices sent out about once a year.

Lose Your House or Lose Your Credit Card

Every day I hear horror stories from folks who tell me they're looking at losing their homes or the family farm. I always wish I could reach through the phone, grab 'em by the shoulders and shake some sense into them, while asking, "Why did you let it get to this point?"

The big question is usually: How did this happen? Most of us usually know. I see it every day. I see the credit card bills with hundreds and thousands of dollars of charges. That's great if you're paying it off every month, but frequently they're digging a deeper and deeper hole. It eventually catches up to you. Ask my brother, my brother-in-law or my favorite cousin. No names here folks. You know who you are. I love them to death, but they could all use a little lesson in discipline. They all lived well beyond their means, purchasing every little upgrade, every new gadget and every new electronic toy the day it came out. Cha-ching, cha-ching.

I can't tell you how many people I run into every day who would prefer to lose their house than lose their credit card. Is that right? Isn't it your castle, your sanctuary? Your piece of real estate is your most important possession and should be guarded wisely. I'm not talking about the Colt and the ADT, although ain't nothing wrong with that. (Sorry you S&W fans.)

I'm proud to say I don't live the life of an innovator. I sometimes shop at Goodwill, do my share of eBay (buying and selling) and love to find a bargain- be it at a department store or grocery store. Ask the wife- my coupon queen. (She inherited that title from my mother, who was also a serious coupon queen.)

And we're now hustling even more with gas now hitting 3.55 here in beautiful Richmond. My job allows me to talk to people across the country every day and the truckers are telling me it will be $4 nationwide soon and then we'll hit $5 by the end of the summer. More and more folks are on their motorcycles and the scooter sales in town have generated a waiting list. Be careful that you don't crash yours into a parked truck or police car like a few have done here recently. Geez. And don't forget your helmet peeps.

Anyho, back to the financial mess. Avoid the foreclosure or the bankruptcy. Cut it off at the pass. Reduce your spending (ASAP) if you're headed into trouble. If that's possible, get some help. Cut your cards up and get some financial counseling. The bankruptcy lawyers are more than happy to take your money to arrange settlements for you. What do they care about your credit? Don't get me started on that.

Avoid the rush to the poorhouse. Sit down with the other adults in your house, look at your bills several times a year, work out a budget and stick to it. Unless you're playing for the NFL or shooting a movie with Spielberg, we should all be doing this. Word.

Create your own card features

Capital One has done it again. They've thrown together another kooky TV commercial that you've probably seen and given us something else to think about. Catch the Frankenstein-like character on the commercial pitching how easy it is to design your very own card, picking your own rewards, APR, credit line, etc. You can even pick out what the card will look like.

Does it get any better than that? Check it out: http://www.capitalone.com/cardlab/

Customize Your Card

Check it out! You can now add your own picture to the front of your card. And we're not just talking about your own picture here. Add your girlfriend, boyfriend, family members, favorite pet, favorite pickup truck or sailboat. Vacation photos would be nice, but just a decent image of yourself would certainly create a different look in your wallet.

What's in your wallet? Capital One says you can go to this link (http://www.capitaloneimagecard.com/) and design the front of your existing Capital One card. And you can even change the look every 30 days. Best part is it's free.

Get Serious!

I can't tell you how many people I talk to every day who complain about their credit or financial situations. I often want to ask, "Have you looked in the mirror recently?" Of course, I value the opportunity to earn a paycheck and cover my own bills, so I'm more tactful.

Folks, if your credit history is horrible, if you're sending bad checks to your creditors or if you're just ignoring those bills in hopes that they'll disappear, don't expect to see additional offers for credit come your way. And don't act too surprised when I tell you, "Sorry, your request for additional credit has been declined." (And let's not kill the messenger either.)

Want an increase on your credit line or that groovy rewards card with the super low APR and all that jazz? It's simple: Ask and ye shall receive. HOWEVER, look at your own credit before you go there.

If you're in the market for a mortgage, refinance, home equity line, auto loan, or a credit card, you may want to give yourself a financial checkup. This doesn't involve a doctor's visit. Just review your own credit at the only truly free, government-endorsed website created for the purpose of the credit report mandate: http://www.annualcreditreport.com.

All Americans are now entitled to a free report from each of the three bureaus: Equifax, Experian and TransUnion. You now have free access to them through this website. I recommend pulling one every four months and alternate between the three to stay on top of your credit. Put a month on your calendar.-SH