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Posted by on May 30, 2008 in Health | 3 comments

Grand Theft, Part Two: Credit Cards; Take Care of Yourself

credit-card-truth.png

We’ve been led to believe that we pay our credit card company for the privilege of not having to provide cash for everything, and that we’re charged reasonable interest rates accordingly.

You know all those cute commercials on TV with cavemen (GEICO) and barbarians (Capital One)?

There are some not-so-cute figures behind the rates on your credit card. Your rate may be beyond usury.

Over a year ago, I closed down a Chase bank card so hard it registered on the Richter Scale when I found out they were charging me 30% interest. You heard right. Three-Zero.

A quiz for you: Take out your credit card(s). Turn each one over and call the number on the back. Don’t read your monthly statement. Call the phone number and speak to a real person. Ask what your current interest rate is TODAY. The ACTUAL rate.

If your credit card is charging you between 14% and 30% …if your rate is absurdly high, ask them to lower it immediately. Amazingly, they often will. (But watch them CLOSELY, for the next month’s cycle they may raise it again with a small notice buried in the tear sheets they stuff into your monthly statement envelope… the ones you never look at.

If they refuse for whatever reason, look into rolling your balance over onto a 0% card from another company. You will save hundreds if not thousands of dollars by doing so.

But keep close track of when the time for 0% expires so you will have, by then, researched that company and other credit card companies that offer a more stable and reasonable rate. If need be, transfer whatever balance you have at that point to a new card.

My dad used to pay cash for everything. Probably your dad or grandfather, too. If he had the cash, the groceries came home. If he didn’t, we lived off the goods we’d canned the autumn before, or went fishing or to the meat locker where was stored deer meat.

Because I travel a good deal for work, I use a credit card. I learned how to handle the credit companies here: Bankrate.com

Go to the website. Enter the words “credit card”

Any number of reliable ‘exposes’ and insights into credit cards will come up. Choose at will. The articles are written in plain English instead of legalese or banker-ese.

The articles will tell you what has been happening re credit card companies/ banks battering the consumer silently (like burying in all those fliers they send monthly that they are raising your rate to astronomical heights without telling you in bold print outright on your statement, for instance.)

And particularly look at the charts of current credit cards available across the country and their competitive interest rates… and yearly rates, if applicable

That’s the piece it seems most people are missing, that credit cards are like any other commodity: shopping for the best bargain is imperative. Banks call their credit cards “a bank product.” You are buying a product when you sign on for a credit card.

Buying a credit card at full freight makes NO sense. Especially when you consider many persons put groceries on their charge cards, as well as coffee from Dunkin’ Donuts, and pay for parking with credit cards too.

If the card is not paid off each month, that loaf of bread can cost $38, the cup of coffee, $26… and the $5 dollar parking fee can swell to $42 in no time

Take care of yourself. Many of us work twice as hard for about half the money we would’ve earned if we worked half as hard fifteen years ago.

I’m not here to scold people about why or how they use credit cards, but just to encourage wise use. Which starts with being informed. Read up. Turn the card over. Call the number. Find out.

______________
CODA
And while you’re at it, if you use ATMs, look into what you’re actually being charged for the service IN FULL, versus what risk you put your sensitive info at re the thieves using more and more sophisticated means to troll the ATMs.

If all this talk about finances gives you a headache and makes your stomach feel upset because you’d rather be spend three days alone in a room with a clown who makes balloon animals rather than squint with even one eye at what’s going on with finances realistically, I’d just say this…

Times have changed, and the tolerances about taking care of whatever little or lot one has worked hard for, are more narrow than in the past. Until we can get cable fees and choices, bank fees, and other no-ceiling/ no consumer input for goods pricing under some controls, it is better to … well, get out the scales and weigh how much we’re pulling to benefit corporate others first and ourselves last.

Most of us can’t create new direction without taking new action.
Most everything in this world is re-arrangable. Most everything is negotiable either in timing or in amounts, extensions or retractions, cessations or revivals. If need be, DON’T hesitate to find an adviser to help. Books are advisers; read trustworthy ones and follow them. Reliable info can be found on websites. Churches act as advisers about debt; Teachers of finance act as advisers. Radio and TV have almost daily programming on finances from any number of knowledgeable people. Partnering with a friend who will support spirit, is good too.

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Copyright 2008 The Moderate Voice
  • unclejoe40

    i would suggest against closing a card account…even if it has a high interest rate…it can count against you…

    instead, first, stop using it…then pay off the balance….keep the card, but only bring it out once a year and buy some gas with it….then pay it off immediatly

  • Actually you’re both right. Part of your credit score is based on what percent of your credit line on all cards is currently in use. So closing down cards with low credit limits won’t affect you as much as closing accounts with high credit limits. If you don’t carry much of a balance at all closing down the smaller cards (particularly gas cards and department store cards which often have high interest rates) can make you appear as less of a risk to lend to.

  • Neocon

    Unclejoe is correct in a way.

    However I have a credit card. A CITI Diamond Preferred Credit card. I just watched my interest rate go from 8.99 to 29,90 in one month because the bill was due on the 12th and they received payment on the 16th. Then on top of that because it was late, they then slapped a 39.00 late charge to it and even though a full payment was received I then got a call from an collection agent saying your account is in default.

    Huh?

    Yeah you were 39.00 short of the full payment.

    Credit cards I thought had resolved themselves when the new bankruptcy laws were put into force preventing credit card debt from being simply wiped away. During that time I did have some sympathy for credit card companies but they have become criminal organizations intent upon one thing.

    Screwing the customer every chance they get for profits.

    Therefore I Immediately demanded my 39.00 be refunded and my rate be dropped back to the appropriate amount and they said well sorry Mr. So and SO but your basically stuck with a 30 percent interest rate for the rest of your FREAKIN LIFE.

    I said do you do payments by phone? Why yes we do that will be a 12.oo dollar charge. Fine Lets just pay that card off close the account and I am going to notify the better business bureau about your criminal activities. (Disclaimer…………ITS REALLY LEGAL)

    So I paid my balance and closed the account and guess what. My credit is still an A+. So while you hear about what Unclejoe says the fact of the matter is that having a credit card sitting there is just an invitation to use it again and to be back in the same situation you were before.

    I would be willing to bet every single person reading my post has had the same experience rather your credit score is a 610 or a 710. I would also be willing to bet that everyone reading this post has at least one bill now or in the past that has insane credit rates if you are just a normal, everyday working stiff trying to make ends meet.

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