7 Tips For Credit Card Management

The invention of credit cards was a giant leap forward for humans. People around the world use their credit cards for all kinds of purchases and payments. The credit cards give the people, the freedom of purchasing what they want, without having to depend on their bank balance. Credit cards are used by all kinds of people in cities and towns across the world. It is a fact that a credit card can be a boon as well as a bane at the same time.

At times, people do not know how to effectively manage their credit cards. This is why, their credit score is severely affected and they find it hard to acquire financial assistance from banks and other lenders. In order to make sure that your credit score is not affected, you need to effectively manage your cards. You need to be careful about making payments and using the card for any purchase.

When you make your credit card payments on time, your credit score improves and you can obtain higher amount of credit. On the other hand, if you fail to make the payments on time, your credit score is negatively affected and you may not get any further credit from financial institutions. Here are a few important tips which will help you in effectively managing your credit cards:

1. Plan your purchases – Before purchasing or buying any product, determine if it is necessary to buy it. You must make a list of your priorities and stick to that so that you can arrange for the money needed to pay your credit card bills. At any point of time, make sure that you do not purchase something too expensive as it will make you cross your monthly budget or the credit limit on your card.

An effective way of way of planning your purchases is to make a shopping list. At the beginning of the month, try to make a list of things you need to buy with the card and stick to that list as much as possible.

2. Always check your statements – Check your statements on a monthly basis as the statements will help you understand your spending pattern. Based on your observation, you can try to avoid unnecessary purchases. Also, checking the statements will help you in knowing the minimum payment due for a particular month, so that you can make that payment on time and avoid extra charges or fees.

You can easily check your statements online, and you can also use your smartphones to keep a track on your card usage. Mobile alerts can be very helpful in ensuring that you do not end up paying more than what you are supposed to, when you use your credit card for any transaction.

3. Try to make full payment – Try to make full payments, whenever possible. When you pay your credit cards in full and within the due date, you do not have to pay any interest on the billed amount. Besides, paying the credit card balances in full will help in improving your credit score. Even if you are not able to pay your credit card balances in full, you should always make sure that you pay the minimum amount due, within the due date.

Apart from saving a substantial amount of money on interest, you will also be able to improve your credit score and increase your chances of obtaining more credit in the future.

4. Keep a track of supplementary cards – At times, you might forget the fact that you have provided supplementary cards to your family members and these cards are linked to your credit card account. The way these cards are used can have an impact on your credit card account. Hence, you should keep a track on them and also ensure that the transactions completed with them are paid for within the payment due date.

Besides, you also need to keep a track of these cards so that you can ensure that the credit limit of your card is not exceeded. If it is exceeded, you will end up paying an over limit fee and other hefty charges.

5. Look out for promotional offers – Why pay more when you can get the same product by paying less? Be a little smart when using your plastic money and make sure that you utilize the variety of offers and promotions provided by the card issuers from time to time. These promotions can provide you with access to discounts, deals and privileges across different segments such as dining, travel, shopping and so on.

You can not only save money through these promotional offers but you can also enjoy a variety of other exclusive privileges which will enhance your experience of using a credit card. Make sure that you always visit a website where you can find information about such promotions so that you can take full advantage of them.

6. Make multiple payments in a month – Do not just limit yourself to making a single payment within the payment due date every month. Instead, try to make multiple payments even if you pay small amounts. It has been observed that the credit card issuers and the credit bureau tend to send payment reports more than once every month, if there is a lot of payment activity in an account.

When you make multiple payments you make sure that the lot of positive information about your credit card usage is being sent to the credit bureau and in the process your credit score will get a big boost. For example, if the minimum payment due for the month is S$1500, do make a payment of S$1500 and apart from that also make other amounts in the same month.

7. Avoid cash advances – You will be provided with the feature of withdrawing cash with your credit card but you should avoid utilizing this feature. When you withdraw cash with your card, you will be charged a cash advance fee and you will also not get any interest free period to make the payment.

Cash advances will increase your minimum payment due and the overall balance of your card and will make it difficult to pay off the balance in full. It can also have a very negative effect on your credit score and so it is important that you try to avoid cash advances as much as possible.

Debt Solutions – How the Federal Government is Promoting Credit Card Help

Taking loans or any other form of debt is not a new thing. People all around the world have been taking financial liabilities to cover the expenses which they cannot cover with their earnings. Other than that people also use credit cards to have an alternate payment mode. Some people also do not prefer carrying cash and prefer carrying cards.

Recession as a issue has created problems in every part of the world. Most of these problems are related to monetary issues and have affected the earnings of the working class. Along with people doing regular jobs, small scaled traders and entrepreneurs have also have to battle financial complications.

In the United States, people have lost their jobs and companies have reached the stage of shut down. A large percentage of people have lost their jobs and have a large credit bill which they owe the bank. The situation is even more complicated as banks are facing sever financial crisis.

This is because of the credit process which they have. Money granting companies pay a large sum of their cash funds to loan takers. As more and more cash is spent in a liable form, the amount of charged interest increases and the bank earns more. During recession as well, the same strategy was used.

As a result of economic problems, a lot of people had lost their jobs and thus were weakened in monetary terms. This is not the only reason for being a defaulter and people do not manage their credit expenses and land up in a long liability. Debt Solutions were introduced by the United States to create coordination between the loan giving bodies and borrowers.

Now, let’s understand how debt solutions work. The initiation of the process is done by the loan takers. They search for a relief company to get them a reduction settlement. The first step in the procedure is to get a dependable settlement company. The relief firm is the key role player in the entire negotiation process.

Most of the hard work is done by the relief company which prepares all the parameters which have to be discussed. A lot of people have been fooled while selecting the relief company. This is because a lot of them do not have the technical knowledge to test the organization in the right manner.

Commonly, people just check whether the company is offering the required services or not. They do not even ensure whether the firm is legitimate or not. Haste is a very negative factor while searching for reliable debt solutions.

Bank and Credit Card Practices – What You Need to Know

Banks and credit card companies employ a lot of underhanded practices that make it seem like the public is benefiting but in actuality, these tricks do more harm than good. If you have encountered a situation wherein you’ve been misled or deceived, banks and credit card companies may be held liable as there are laws that regulate such practices.

Criteria for Deceptive Acts

The Federal Deposit Insurance Corporation (FDIC) has outlined certain measures to curb misleading practices. Banks and credit card companies are mandated by law to sufficiently explain the characteristics of a given promotional offer. The information found on advertising literature must be complete. For example, a credit card reward program should not only harp on how much cash a consumer is paid back, but should also detail the provisions and circumstances under which this reward is applicable.

Some credit card companies highlight the cash back offer but fail to disclose details such as up to how much a consumer must spend before the reward is granted, the duration of the promotion, whether this reward is given as a lump sum and so on. Omission of such important details is a clear indication of deception.

Information on advertisements must not be ambiguous so that the consumer understands what a particular service or product entails. Additionally, any follow up communications with the customer must be able to further clarify the terms and conditions of services or promotions to ensure the customer really understands the intended message.

A Word on Overdrafts

The FDIC along with other regulatory agencies has come up with guidelines as to how services such as courtesy overdrafts should be marketed and communicated to customers. These rules are quite simple but clearly, a lot of banks don’t follow these rules.

First, all fees associated with the overdraft program must be divulged. This includes transaction fees, interest rates, penalty fees and so on. Banks should also disclose in what instances these fees will be imposed. Will the customer be charged per transaction, is there a daily charge and so on.

There are even rules on proper notification regarding overdraft protection usage. I f possible, the bank should inform customers if a particular transaction will bring about any overdraft fees and they should be given an opportunity to opt out of the transaction. The bank should also provide notification to the customer once he has accessed the overdraft program. Details such as overdraft amount, fees incurred from the transaction, how much the customer needs to repay the draft should be outlined in the notice.

What to Do

If you believe you have been subjected to misleading practices you can issue a complaint to the bank. You should first try to resolve the matter directly with them before attempting any other measures.

Should this fail, you can ask for assistance from the consumer helpline of the Federal Reserve. You can file a complaint online, through fax or through snail mail. Your complaint letter should contain your name and account details, the name of the bank and the representatives that you’ve dealt with as well as a detailed explanation of your problem.