Be proactive rather than reactive with your credit card accounts when you are facing hardships. Don’t wait until the credit card company jacks up your rates and you can no longer pay your bills. Call them and negotiate before you are late with your bill, or broke. The better your credit is, the more negotiable the credit card companies are. If a health crisis arises or you are laid off, call your creditors, explain the situation to them and work out a plan with them. Ask what your options are.

Here are some things that I have successfully negotiated with credit card companies.

1. Your due date can be changed. They won’t change it for the current bill, but it can be changed for future bills. This is helpful if you change jobs and will be getting paid at a different time during the month, or you have too many bills due at the same time of the month.
2. Request a lower interest rate.
   • If you have an offer to transfer your balance to a new credit card, it would be better to call up your current company and negotiate with them. Tell them about the offer you have and let them make you a counter offer, rather than have new credit cards or balance transfers on your credit report. Besides, there are usually fees if you transfer a balance.
   • If you always pay your bills on time and you are late on one, request that they set your interest rate back to the rate you were at before your payment was late. They may give you the benefit of the doubt at least once. Don’t abuse this because they will make a note of it in your record.
3. If you go over your limit, make a payment that will bring the card back below the limit, then ask the company to remove the over-the-limit fee.

Above all else, remember that attitude counts for a lot. If you want people to work with you, you must be willing to work with them.

The fastest way to raise your credit score is to never let it fall. However, circumstances such as losing your job or medical emergencies can do you in. The fastest ways that you find to raise your credit score could backfire. The best advice is to improve your credit responsibly over time. So here are some pointers for raising your credit score:

1. Always pay your bill on time.
2. Always pay your bill on time. Sorry, but I can’t emphasize this enough. Even if you owe $5, pay it on time.
3. Lower your debt to credit limit ratio.
4. Close credit cards that are store specific. You should never have more than one of these, because they reduce your credit score. Each one you apply for can reduce your credit score by 20 points.

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Right now the credit card industry is a little haywire thanks to the economic meltdown we’re in.
Companies are cutting people’s credit limits without notifying them, and in some cases, even closing credit accounts without reason.

So, what should you do? I say turn the tables! Make your credit card companies work for you, instead of the other way around! If you pay your bills on time and have good credit, there are tons of ways to get a better deal out of your credit card companies - all you have to do is ask.

Each and every one of the strategies below can be accomplished with a couple of simple phone calls to your credit card companies. The amount of money you can save should more than make up for the time you have to spend on the phone!

You will almost certainly have to talk to a customer service manager to get these types of deals, so don’t waste too much time with the representative who answers the phone - just ask to speak with their manager or supervisor.

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Recently a friend asked me the following question: “If I have 4 Visa cards, 1 American Express, and 3 Store Cards, is that too much? I am never late and pay off almost all of them. Should I be closing some or just keep them open without using them?” -Jeffery

The Answer
The amount of credit cards you have open do not directly impact your credit score. However, your amount of debt to credit ratio does. For example if you have $10,000 worth of credit and $2,000 worth of debt, then you debt to credit ratio would be 20%. The higher this percentage is, the lower your credit score will be. It is a good rule of thumb to use less than 30% of your line of credit on any single credit card.

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Devil’s Advocate It’s funny how everyone has fallen into the credit world of credit cards and credit score. Credit cards are like tricky games of who can out smart who and credit scores are just silly numbers that companies and institutions with trust issues use to size you up. Wouldn’t your life be so much better if you never have to worry about juggling your money on credit cards or have to stress about getting a high credit score? Wouldn’t that be great?

If you think it is impossible, then I am glad to tell you that you are wrong because people live without credit every day.

The Secret
The secret to living without credit is…

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You receive unexpected “convenience” checks in the mail from your credit card company. Should you use them? Read the Fine Print Before using convenience checks you need to look for the following:

• Does it have a fee - such as a 3% to 4% same as cash fee?
• Does it have a higher interest rate? Cash advances have a higher rate.
• Does it go to the higher cash advance interest rate after an introductory period?

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We are receiving several questions about existing credit card debt and whether to close open accounts with no balance. So I will answer several of your questions here.

1. Should I close open accounts that have a zero balance?
   • Leave at least one open to show you have more credit than you are using.
   • Don’t close them all at one time. Close one or two and then check your credit report and credit score in about 60 days to see how it affected your score.
   • Close newer cards with zero balances. Keep older cards that show a lengthy and successful credit history.

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You can file a dispute whenever you have reviewed your credit report and do not agree with the status of an item on your report. If you requested an online credit report, there will be an option on the screen while you are logged in to your report that will allow you to dispute an item. Disputes can also be submitted in writing or by phone to the credit reporting agency.

When reviewing your credit report, remember that there can be up to a 30 day lag between when you pay your bill and when the amount owed is reduced on your credit report. So don’t expect it to reflect recent payments.

One thing to check your credit report for, are accounts that show open that you thought were closed. However, don’t be hasty in closing them if there is no reason to. They may actually be helping your credit score because they show that you have more credit than what you are using.

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If you have bad credit and have found yourself struggling to pay off your debts, there are lots of little things that you can do to save money. Here’s a list of ten little things that’ll save you a few bucks – and remember, however few they are now, they all add up in the end!

1. Pack your own lunch.

Packing your own lunch can not only be more nutritious for you than grabbing a quick bite at the closest burger shack, but can save you lots of money – eating out is expensive! You could probably buy all the fixings for a week’s worth of sack lunches for what it costs you to have lunch at Ruby Tuesday’s. If you eat out because of the social aspect, consider organizing a pot-luck where everyone brings food from home.

2. Coupons.

Before you go shopping, you should check out the newspaper for coupons that are relevant to you. Many stores even have their coupons online, which you can print from the comfort of home. I just got a coupon the other day for a free 24 pack of bottled water! If you don’t look for the coupons, you won’t know they’re there and you won’t be able to get those savings.

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Are you one of those people who cringe when you see someone else splurge? Are you a money-saving mad man/woman? Well, you’re not alone. Some of us are just natural savers. We gather money and hog it like there’s no tomorrow. It frustrates us when we see our friends and family spend money so freely. We wonder why our conscious prevents us from buying things that aren’t necessities, even if we do want it really bad. Okay, maybe we have a money-hogging impulsive disorder, but that’s another story. For now, let’s just say that saving money is a good thing and we should get other people to do the same.

Enlighten the Future
Just about everyone gets excited when you start talking about great financial opportunities for the future. I mean, wouldn’t you get excited if I told you you could be rich in a couple years? You can tell your friend about all the wonderful things you can do when you save your money for the future. You can save to purchase a car cheaper, because you won’t have to finance it. You can save for school, so you don’t have to take out loans and pay interest. You can even retire earlier. Saving money doesn’t mean you hog it and just to let it sit somewhere; saving money can reduce the net amount of money you spend on purchases so that you have extra money in the future to spend on more things, like a nice vacation. Saving money lets you buy more, no matter how strange that may seem.

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Higher Interest Rates and Fees

The rule of thumb is the lower your credit score is the more money you will pay for everything. This includes everything from credit cards, loans, mortgage, rent, utilities bills, insurance and the list can go on forever. The point is that a bad credit score means that others can take advantage of you. If you want a credit card or loan, they’ll give it to you, but with a higher interest rate and more fees than anyone else. For example, if you were to pay off a $20,000 car over the period of 5 year and you had bad credit, you will pay $8,000 more in interest compared to a person with good credit.

A lot of people with bad credit who need money resort to using payday loans, which are short term cash advances that are paid until your payday. The interest on these can be over 1800%. Similarly, in desperate times, a person may resort to car title pawning. This is when you surrender the title of your car to borrow up to half of the car’s worth. During this time period the owner of the car can still keep it but if he or she misses a payment on the loan then the car can be confiscated. The interest for borrowing money through car title pawning can be over 800%.

Lose Job Opportunities

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This article comes from our first guest columnist Angel Hill. She lives in Savannah GA and has maintained excellent finances her whole life, partly because her mother is an accountant!

In today’s world, there is the perception that credit cards are king. Businesses and even lives are being built around credit cards, and the satisfaction of having everything you want instantly. The downside to this is that you have to pay these credit cards off – and this is where most people get stuck. They spend and spend, then fight an uphill struggle trying to pay their platinum super max master-visas off. In order to uphold their style of living, they survive by paying their minimum balances from month to month, even using one card to pay off another, and this does nothing to alleviate your actual debt, and lowers your credit rating. Many of my fellow college classmates have found that because their parents have such poor credit, they can’t qualify for student loans. So what do these students do? They get themselves a credit card to pay for school.

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