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 bill for the new credit card rules has been approved, but the rules do not take effect until July 1, 2010. The rules sound good to me, but there are some who say it will make matters worse. They say the banks will try to make the money they will lose in other ways. But it makes more sense to me that by that time the banks would extend less credit to those who would be a high risk. See what you think by reading the following.

The new rules include five key protections for consumers who use credit cards.

1. Banks would be prohibited from increasing the rate on a pre-existing credit card balance, and must allow the consumer to pay off that balance over a reasonable period of time. The consumer would be given 45 days notice before a rate increase. The increase will typically apply to future purchases rather than current balances. However, the rate can be increased if
   • it is a variable rate and the rate index changes
   • a promotional rate expires
   • the minimum payment is not received within 30 days of the due date

2. Banks would be prohibited from applying payments in excess of the minimum in a manner that maximizes interest charges. They would no longer be able to apply all payments (over the minimum payment amount) to the balance with the lower interest rate when the borrower has balances with different interest rates due to promotional offers or cash advances, etc.
3. Banks would be prohibited from imposing interest charges using the “two-cycle” method, which computes interest on balances on days in billing cycles preceding the most recent billing cycle.
4. Banks would be required to provide consumers a reasonable amount of time to make payments. There have been class action lawsuits because of companies that send you your bill at the last minute, and then hike up your interest when your payment is late. The new rule would provide a safe harbor for banks that send periodic statements at least 21 days prior to the payment due date. In addition, a payment received by mail on the next business day after a due date, when the due date falls on a Sunday or holiday, would be considered timely. The payment must be received by 5 p.m. I have seen 2 p.m. listed on some of the current credit card rules.
5. Solicitation for new credit cards that offer multiple rates or limits, will be required to list the factors that determine whether a consumer will qualify for the lowest rate and highest credit limit.

The rules also ban the practice known as universal default. The bank will not be able to adjust your rates based on how you perform with other bills such as utilities and memberships.

There is also a new rule for bank accounts.

The new rule also provides the opportunity to opt-out of the payment of overdrafts before any overdraft fees or charges may be imposed. The bank would be required to notify you that the payment would be an overdraft.

Does this help or hurt?

I would love to see these changes now. However, there are those doing studies who say this will only make matters worse. Yes it could cut the profits of the credit card companies. I think they hurt themselves anyhow when they jack up interest rates on those who are already struggling to pay, to the point that they can no longer afford to pay. Do they actually make more, or are they forcing more people into bankruptcy?

A study by the law firm Morrison Foerster found that if the industry loses the money they make from the current rules, the reduction of credit would be at least $2,029 per account. So they are saying that there would be less availability of credit at a time when policymakers are trying to get consumers to spend money. Are they forgetting that this doesn’t take effect yet?

I believe the credit card companies extended too much credit anyhow. The real problem now is that nobody can get loans to buy major purchases. I don’t like having my credit limits cut, especially since that makes me look more in debt with my debt to limit ratio. However, I know that there is no way I could pay my bills if I maxed out all my credit cards to the limits that I previously had.

I think it is time that the consumer had more protection against the issuers of credit cards. However, I did read one comment that warrants consideration. Will those with good credit end up subsidizing those who don’t? Will the banks charge everyone higher interest rates because they can’t jack up the interest rates on people who don’t pay? As I said at the beginning, they will have time to be more selective of who they extend credit to. So wouldn’t they save money by having fewer people default? What do you think?

Are you afraid to use your credit card online? Most credit card companies limit your liability for unauthorized or fraudulent charges to $50. You do not have this security with a debit card. Keep reading to discover a way to limit your liability for online credit card use to $0!

Databases that store your credit card number are frequently hacked. Just because you do not use your credit card to make online purchases, does not mean that your credit card number is not stored in a database that can be hacked.

I had an online purchase show up on my credit card once. However, in that case I think that the purchaser had incorrectly entered the credit card number, and just happened to have the same expiration date. So that is one reason that the three digit CW2/CID number on the back of the card helps identify the correct number was entered. To fix the problem, I just called the credit card company and explained that I had never shopped online with that retailer, and they reversed the charge.

I found another great way to protect yourself with online purchases that limits your liability to $0!

Discover Card has set up a zero dollar liability program. The way it works is they generate secure account numbers. Instead of using your real credit card number, Discover Card assigns you a secure number that is linked to your account through a secure database. When you shop online, you enter your assigned secure number.

Your secure number expires when the credit card does. So when you receive your new card, you can get a new secure number.

This is a downloadable program that is stored on your computer, but they also have a web version so that you can shop online from multiple computers. The secure number can also be used for recurring charges. You can have different secure numbers for different retailers, as long as the numbers are active. You can only maintain a limited number of unused secure account numbers.

The only time you will not be able to use your secure number is when you will have to show your actual card to verify the purchase. This usually would occur with online purchases of airline or movie tickets.

So to start having more protection for online purchases, apply for a Discover More Card by clicking here Discover Card. Or review the Discover Cards offered on our Credit Card Finder.

Many of us blame credit cards for getting us into debt, which leads us to believe that credit cards are evil and should be eliminated from our lives. While the idea of not spending more money than you have is on point, the notion of eliminating credit cards is just silly. Consider the following points before deciding to live solely on cash.

VS.

Spending cash can’t make you cash like credit cards can.
You don’t get rewards or discounts for paying in cash. But you do get rewards such as cash back when you use credit cards. With rewards credit cards, you can even earn points for gifts, travel, gas etc. If there is something you are going to buy, then you might as well buy it with a rewards credit card and get rewards for making the purchase. Buying in cash doesn’t give rewards, but credit cards do.

Cash is unsecure.
If your cash is stolen, then it is gone forever. But if your credit card is stolen, then your money can still be secure by simply reporting your card stolen. Carrying around tons of money just isn’t a good idea.

Cash isn’t accepted everywhere.
More and more places these days aren’t accepting cash, such as car rental agencies. It’s always good to have a credit card handy just in case.

Cash doesn’t leave a paper trail.
By leaving a paper trail it’s easier to see where all of your money is going. Unless you’re great at writing all your expenses down, your credit card bill can be used as a simple way to document your expenses. Knowing where all of your money is going can help you budget your money for the future.

Living just on cash isn’t the solution to anyone’s money problems. Credit cards are great for helping you save money by giving you cash back or rewards when you use them. Just remember to not spend more money then you have.

Do you have an opinion about cash vs. credit cards? Share it with us by leaving a comment!

1. Apply for financial aid, grants and scholarships (free money). Grants and scholarships are officially free money for college students. The most work you would have to do is write essays, collect recommendations or fill out applications. Just compare it to the real world, the work you do for scholarship money is less than the work you would do at a job for the equivalent amount of money. Scholarships and grants are easy, free money.

2. Get a job that will pay for your tuition.
Indeed there are jobs that pay more than just a salary. Certain employers will actually pay for your education. Look for companies that have positions related to your major.

3. Buy and sell books online.
The bookstore is always overpriced. You might as well purchase your books online since thousands of students are trying to get rid of their books at low prices. To get extra cash, you can sell the books you don’t need any more online to other students in need of them. Of course, one place to find and sell college books is on eBay.

4. Budget your money.
As lame as it may seem, budgeting is the best way to save money. You have to know where your money is going before you can determine how to save it. Budgeting doesn’t have to be a long drawn out process. There are simple, easy, and fast ways to budget.

5. Use a cash back credit card.
Credit cards are great for building credit when used properly. When you use credit cards, you might as well save money by getting cash back according to the amount of money you spend.

6. Make a grocery list before going grocery shopping.
It doesn’t really take as long as you think it does. Just jot down the items you need to purchase before going shopping. That way, you don’t over spend on things you don’t need by aimlessly roaming in the aisles of the supermarket.

7. Pack a lunch instead of eating in the cafeteria.
Universities and schools often advertise that their meal plans will save you money. But honestly try doing the math. It’s cheaper to make your own lunch then eating from the cafeteria.

Do you have a tip for college students? Share them with us by leaving a comment!

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.
5. Don’t use credit cards for large revolving debt. For instance, don’t charge $1,000 every month and pay it off. If you do this repeatedly, you lower your credit score.
6. Having credit cards and installment loans, and paying them on time, will raise your credit score. Someone who has managed credit cards responsibly has proven to be more credit worthy than someone who does not have any credit cards.
7. Don’t apply for multiple credit cards at one time. Credit applications and inquiries are logged on your credit report. If you apply to three different credit card companies, the third one will see that you have applied for two other cards. They could turn you down just because they are afraid the other two will approve you. For example, if you get two or three credit cards at one time and charge them to the max, you will probably not be able to afford the payments. Most credit scores are not affected by multiple inquiries from auto or mortgage lenders within a short period of time. These are typically treated as a single inquiry.
8. Don’t close multiple unused cards at one time. Leave longer term cards open when possible. You want to show that you have available credit, but not so much that your debt to income ratio will suffer. Closed accounts still show on your credit report.
9. To rebuild credit, get a secured credit card. The deposit you make will be your line of credit, but the deposit is held by the credit card company. You still have to pay at least the minimum payment before the due date each month.

What is a Good FICO Score?

You have a FICO score for each of the three credit bureaus. Your score can vary from credit bureau to credit bureau based on when your credit record was last updated. This score affects how much and what loan terms, such as interest rate, that lenders will offer you at any given time. So to get better interest rates and loan terms, raise your FICO score.

It is called a FICO score because the score is generally produced from software developed by Fair Isaac and Company. However, many lenders use their own credit scores and ranges which often include the FICO score as well as other information about you. For instance, they may use your employment history.

Below is a chart that shows the typical FICO ranges.

If your identity is stolen you need to act fast. Follow the steps below to stop identity thieves in their tracks.

Step 1: Call Your Bank

You are not liable for much (if anything) that is charged on your credit cards in the event of identity theft. Your bank account is a different story though. You can be held liable for any charges that were made before you notified the bank that your accounts had been compromised. So call your bank first, before you do anything else!

Tell them to cancel your debit cards and your checks. If necessary, have them completely close the account and open up a new one. You should also dispute any charges that were made before you called your bank. There is a good chance that you can get the charges credited back to your account. Your individual bank will walk you through this process. I had to do this myself when my identity was stolen, and it was simple, and quick. As long as you take this step first, you will be protected from the worst of the financial damage that an identity thief can inflict.

Step 2: File A Police Report

Next you will need to call your local police department. Do not call 911 int his situation. Tell them that your identity has been stolen, and file a police report. You will need to get a copy of your police report, and keep the report number close - you’ll need it to complete the next few steps.

Step 3: Call Your Credit Card Companies

Once you have filed your police report, call your credit card company. Give them the police report number, and have them cancel your current credit cards. They can either re-issue you a new credit card on the same account (with a different number) or close your credit account and open up a new one.

From a financial perspective, it is better to keep your credit card accounts open, and just have a new card issued. If you close your credit card accounts it will impact your credit score - even if they open new accounts for you. So, keep those accounts open unless there is no other way around it.

As far as liability goes you should not be liable for more than $50 of any charges that were illegally made on your credit accounts. Visa, in particular, usually offers zero liability. Be sure that you check your next credit card statement carefully and note any fraudulent charges. Call your credit card company and dispute those charges. Give them your police report number again when you call to dispute the charges.

Step 4: Freeze Your Credit Reports

It is important that you freeze your credit reports, and do not simply place a fraud alert on them. If you place a fraud alert on your credit reports, it means that lenders can still pull your credit score - which means that an identity thief could still possibly open up new accounts in your name.

Freezing your credit reports on the other hand, means that no one can access your credit reports or scores but you - at least until you choose to un-freeze them. If lender’s can’t access your credit score, then there is zero possibility of an identity thief being able to open up a new account in your name.

If you have filed a police report, you will be able to freeze and un-freeze your credit reports for free in most states. To begin the process, you can visit the three main credit bureaus online. You will need to create accounts with each of them.

• Equifax
• TransUnion
• Experian

You can also read more about freezing your credit reports in our article “What is a Security Credit Freeze and When Should I Use One?“.

Step 5: Replace Your Driver’s License and Social Security Cards if Necessary

If your driver’s license or social security number were stolen, you will need to have new ones issued. You can contact your local DMV (Department of Motor Vehicles) and Social Security office to get them replaced, or have new ones issued.

Step 6: Check Your Credit Report Each Year

Once an identity thief has your information, it is safe to assume that they always have it. For this reason alone, make sure that you check your credit reports at least once a year. You can check all three of your credit reports for free each year by visiting Annual Credit Report.com.

If you are not comfortable checking your credit reports only once a year you can purchase a credit monitoring service that will let you check your reports any time you want to. Access to all three of your credit reports typically runs about $30 a month.

All three credit bureaus offer this service. I have tried all of them, and I recommend Experian’s credit monitoring service over the other two. For $30 you get to see your reports from all three credit bureaus, all laid out on one page. Experian also offers some basic identity theft protection as part of their service. It’s far and away the best deal if you do end up needing to monitor your credit reports.

Step 7: Check Your Police Report Each Year

While your initial worry is going to be how much money you will be liable for when your identity is stolen, don’t forget to check your police reports each year. False identities are used in crimes all the time, and you don’t want yours to be one of them. For more information on how to do that you can check out this article titled, “In Case of Identity Theft, Check Your Criminal Records“.

Identity theft is big business. In 2007 alone there were over 670,000 reports of consumer fraud and ID theft.

So how do you protect yourself? What can you do to prevent identity theft from happening to you?

While you may not be able to protect yourself from all cases of fraud or identity theft, there are a few simple things that you can do to help keep your information out of criminal hands. If you make these steps your regular habits, they will serve as a shield for your personal information, and make the possibility of identity theft a lot less likely.

Shred Your Personal Information:

Most of us already know that we should be doing this - but very few of us do! You can buy a cheap shredder at any office store, and run every single personal document through it before you throw it away.

Honestly, the possibility of an identity thief spending time sorting through your garbage is becoming more and more remote. There are just easier ways to steal someone’s personal information. However, it does still happen! So it’s still a good idea to protect your identity by shredding your documents and mail. Make sure anything with a bank account number, credit card number, social security number, or even your date of birth gets destroyed before it goes into the trash.

Switch To Electronic Statements:

If you switch over to electronic bank and credit card statements, your personal information passes through fewer hands before it gets to you. That means there is less chance for it to be intercepted through the mail, stolen from your mailbox, or (eventually) pulled out of your trash.

Use Cash More Often:

It never ceases to amaze me that some people are so paranoid about identity theft that they will shred all of their mail, and refuse to use a credit card online. Yet those same people will happily hand their credit card to a teenager at a drive through or in a restaurant and not watch what they do with it.

Why does this amaze me? Because I had my identity stolen this way. I handed my debit card to a guy at McDonald’s and about a week later a small charge was made on my credit card from the same McDonald’s. Since I still had my debit card in my wallet, I can only assume that they copied the information and ran a charge through to see if it worked.

Luckily, I caught the charge and was able to immediately cancel my card before they did more damage. From now on, I am going to pay with cash when I eat at a restaurant, period. No more handing it over in the drive through or sticking my credit card into the little folio and letting the waitress walk away with it. Just cash.

Read Your Emails Carefully:

We’re probably all familiar with the Nigerian entrepreneurs that spam our in boxes with letters like this one:

Greetings and Bless you!

You are probably tempted to be hearing from me I am Anna Hayes daughter of the late Mark Hayes a pioneer in the British Royal Navy. When my father passed he left a large sum of money $4,000,000.00 that must needs be transferred into the United States…..

Ok, so we all know those are bogus. The types of emails to watch out for are a little more insidious. Take Paypal for instance. I get an average of two letters a week stating that something is wrong with my Paypal account. The letters encourage me to click a link and log in to verify my account.

When you click the link, the page is set up to look exactly like a Paypal page, but it isn’t. It’s a dummy page intended to steal my log on information.

So, when you get an email, any email, whether it is from Paypal, or one of your credit card companies, or your bank, always check the sending address. In other words, if it does not say: address@paypal.com, or address@Americanexpress.com it is not legitimate.

If it says address@paypal.something.com, it’s not from Paypal - it’s from people trying to commit fraud.

Likewise, check the addresses of any links that you click to be sure that they show the correct domain name.

Online Credit Card Applications

As a final note, be careful with online credit card applications. Make sure they are from legitimate websites like this one -The Credit Beacon, or the link above. Make sure that address bar at the top of your browser has an https://www, and not just an http://www. the “s” means it’s a secure connection - otherwise your personal information is not being encrypted and it can be easily stolen.

If you follow these steps regularly you will protect yourself from many of the most common types of identity theft and fraud.

How about you? Do you have any identity protection tips? Leave a comment below!

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.

Get your fees removed:

Tell the supervisor you speak with that you are going to have to balance transfer your account unless they can help you. Remind them of your excellent payment history and the number of years you have had an account with them.

Step one is to ask for the removal of any and all fees that are currently on your credit card. *This step really only applies to you if you carry a balance on your credit cards. No company is going to write you a check for fees that you have already paid off!

If you have ever been over the limit, late or paid a membership fee on your credit card, and the charge still exists on your credit card balance, ask to have it removed.

Some credit card companies will only remove one fee of this type, while others will remove up to a years worth of late, over the limit and membership fees!

Lower your interest rate:

If the manager you are speaking with is helpful, go ahead and ask them to lower the interest rate on your credit card. If they are not helpful, and you had to argue to get your fees removed, just hang up and call back on a different day. Chances are you can start the conversation over with a new manager who will help you take the next step. Just pick your battles depending on how agreeable the manager is - but be persistent. All of these things are possible if you are patient, and polite.

When you request that your interest rate be lowered, you will have a couple of possible options. Your credit card company may offer to give you an temporary zero percent interest rate, or a permanently lowered interest rate that is a few points off from what you have. Make sure you understand whether or not the interest rate change is permanent, or temporary before you get off the phone so that you can budget accordingly.

Upgrade your credit card / increase your limit:

Depending on the temper of your customer service rep, again you may need to hang up and call back. Alternately you can remind the manager that you do intend to transfer your balance if they do not help you, and suggest they transfer you to their retention department if they have one. Most credit card companies do.

The retention department has a lot of room to negotiate with you and they excel at giving you what you want. In this case, consider asking if they can upgrade your credit card account to one with a permanently better interest rate, lower fees, or a higher limit.

Most people get comfortable with their credit cards and do not realize that everything is up for negotiation! Never forget that this is your money, and your credit on the line, so it’s worth a little haggle now and then to be sure that you are getting the very best deal possible when you borrow money.

Also, don’t forget that if your credit card company is completely rude and refuses to work with you that you really can balance transfer your debt to a credit card with better terms! There is no reason to pay more money in interest than you have to - especially if you regularly carry a balance on your credit cards.

Budgeting your money is one of those things many of us dread to do. If you haven’t experienced it already, living paycheck to paycheck isn’t ideal. So, if you haven’t made a budget for your money yet, today is the day to start one. It isn’t as hard as many people think. Money Tree created a brand new software application that I believe will help beginner budgeters. Here are the benefits of this software as opposed to other methods of budgeting:

• Create you entire budget in less than 20 minutes
• Simple, Fast, and Easy to use
• Helps you meet the goals that you want to accomplish (like save money for a new car or TV)
• A fun, vibrant, colorful appearance (like candy for your eyes!)
• You budget for the future, not just track money you already spent
• Help you keep on top of your spending with friendly reminders every time an expense is due
• Balance the amount of money you have in just a click of a button
• Track your budgeting history in a neat timeline graph
• Does math for you, so you don’t have to do it!
• Not confusing like other software
• Free upgrades and expansion packs (if you purchase before 1/15/09)
• 60 day, no questions asked money back guaranteed if you are not satisfied
• Plenty of support and help if needed

Money Tree- Seedling Edition budgeting software, is the easiest way that I know to start a budget. I use it and you can too. Yes, you can make a budget with paper and pencil or use other methods, but truthfully Money Tree is the best solution for saving time. Money Tree only costs $24.95. Plus if you end up not liking it or not using it at all, you can always request a refund for your money. Money Tree is one of the best investments you can make to help you save and budget your money more effectively. I suggest giving it a shot since there’s nothing to lose!

Money Tree is dedicated to helping everyday people survive the downturn of today’s economy. If you seriously cannot afford Money Tree software but would love to use it to budget your money, I will personally help you obtain a copy!

You can find out more about Money Tree – Seedling Edition and purchase your copy at MoneyTreeBudgeting.com.

If you have any questions about Money Tree, let us know!