Are You Like The Titanic? Speeding Towards An Iceberg To Your Doom

Everyone have recognition cards. They assist do life a spot easier. Most people begin out using them as a safety net. But...there is danger in those small plastic life preservers.

I'm sure this volition sound familiar to you. You travel to the shop to purchase something. Let's say...the DVD of your favourite movie. When you acquire in the shop you detect sale marks everywhere.

Before you acquire the DVD you came in for, you begin to browsing through the sale racks. You come up across a few movies you were thinking about buying. "Well, they're on sale" you believe to yourself.

Before long you, have got got a stack of DVDs and you haven't even gotten the 1 you originally went to the shop to buy. You dart to the subdivision with your DVD, catch it and travel to the register. The clerk rings you up andto your surpriseyou have got got just spent more than than $217.

You weren't planning on purchasing so much and you don't have adequate hard cash so...instead of putting the DVDs back you flog out your recognition card and manus it to the clerk. It's only $217. No large deal, right?

But, it really is a large deal. Because, the DVD's are only the tip of the iceberg...it's not just DVDs you purchase with your recognition cards, it's everything you purchase with your recognition cards.

Paying With A Recognition Card Doesn't Feel Like

You Are Spending Your Money

When you pay with a recognition card, you experience like you got something without paying for it...almost like it was free. You probably don't even believe about it until...

Your recognition card measures arrive. Then it registers. When you have got to pay the bill. You acquire a sinking feeling. You recognize you can't pay the whole measure this month. And so gets your downward spiral...

Because, the followers calendar month you make the same thing. You travel to the shop to purchase something and out protrudes that small plastic card again.

Even though last month's recognition card measure surprised you and you couldn't pay it off in full, you believe to yourself "I've got it under control".

Until one day, you acquire to the registry and your recognition card is declined. You have got reached your disbursement limit...at least on that recognition card. Ah, but never fear, you have got other recognition cards.

So you maintain getting deeper and deeper into debt. Pretty soon you are so deep...you can barely maintain your caput above water. Your monthly payments are getting out of reach.

And now you necessitate to utilize your recognition card game just to pay your mundane bills. Things like groceries, heat energy and electric. But as you pay for these necessities, you acquire deeper still.

Now, you're level deeper than before. You necessitate to set even more than on the cards. Your payments go on to turn until, you can't even afford the lower limit monthly payments. Before you cognize it you can't purchase the things you necessitate and you are drowning in bills.

Ok, maybe it's not that bad...yet. But is this the way your heading? If you answered yes, you necessitate to make something about it, right NOW! Don't wait until your debt sinks you.

Credit card defaults keep rising, report says

NEW York (CNNMoney.com) -- American consumers are defaulting on their recognition card game at a sharply higher charge per unit compared to last year, in what could be another effect of the recent subprime mortgage marketplace crisis, according to a study published Tuesday.

In addition, late payments are also up, cardholders are showing marks they are less willing to pay and recognition card companies have got written off 30 percentage more payments during the first one-half of this twelvemonth versus a twelvemonth ago, the Financial Times reported.

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The recognition evaluation federal agency Moody's told the paper the job could be owed to the place marketplace lag and fewer householders opting not to refinance their residences.

"The combination of higher involvement rates and a softer existent estate marketplace diminished the attraction of mortgage refinancings in which many borrowers reduced their more than expensive recognition card debt by drawing on the equity in their home," Moody's told the paper.

At the same time, Moody's said that the people defaulting on their recognition card game may not be the same people defaulting on their subprime place loans. The federal agency cited stricter underwriting criteria in the recognition card industry and the fact that borrowers with small or no equity in their places may take to default on on their abode before giving up their recognition card, according to the paper.

Stoozing Credit Cards

"What makes 'stoozing recognition cards' mean?" you might ask. The reply is easy. This is just a manner of making money by taking advantage of recognition card game that have got introductory 0% charge per unit offers. This lets the stoozer to borrow money for "nothing" and the chance to travel it into a high street nest egg account. Having said that, stoozing is not suitable for everyone as there are possible hazards involved. You necessitate to pay attending to item and inquire yourself the followers questions:

• Am Iodine financially savvy and can Iodine give clip to pull off my finance prudently?

• Do Iodine have got got an oculus for details?

• Will Iodine have the clip to research new offerings and do new applications?

• Can I ran into clip deadlines when transferring money?

• Will I be able to keep back enticement to spend/ gamble/ put the borrowed money when it is sitting in a no hazard account? (A "no hazard account" intends you are able to pay off the borrowed money, on time.)

If the reply is a "No" or "I don't know", then it's outdo to remain far away from stoozing. However, if the reply is a "Yes", then you are ready to stooze. As a stoozer you can gain anything between £500/- to £2,500/- annually just through stoozing. There are two ways of making money through stoozing. 1. At the end of the introductory 0% charge per unit offer, retreat the "Credit Card" money from the nest egg business relationship and usage it to pay off the full recognition balance. The involvement you will have got gained from your nest egg business relationship will be your "profit". (But make retrieve that, as always, the taxpayer necessitates to pay taxation on the involvement earned.)

2. The other manner is that you could set the borrowed money into an countervail mortgage instead. This volition cut down the involvement of your mortgage calculations. This debt decrease is usually taxation free because the borrowed money is not your income.

Credit Card Reward Programs

When you are applying for new credit cards, take a look at the reward programs they offer. Almost every major credit card company like MasterCard or Visa offers some type of reward program. Some offer cash rebates and others offer merchandise. See which one helps you out the most.

Cash rebates offers with credit cards vary depending on the company. Most offer between 1% to 5% cash back on qualifying purchases. That means that during the year if you spend $20,000 on your card you could earn up to a $1000 back. Make sure you read the terms, though, because many have a cap on how much you can actually earn back. The key to really taking advantage of this option is not to carry a balance and give all your rewards back in interest.

Many people I know save the cash back money and use it to take their yearly vacations. If you are not carrying a large balance on your credit cards and losing it on interest, you will actually be taking your vacation on them. And if you have $1000 to travel with, you can have one heck of a vacation

I personally prefer using cards that offer merchandise for your purchases. Usually you will receive one point for every dollar you spend. Then once you accumulate a certain total you can choose some merchandise. Many of them offer an online catalog to shop from. The credit card companies offer the merchandise in tiers. For instance, you might be able to get a $50 dollar gift certificate for 5000 points, but for 100,000 points you have the option of getting a high-tech outdoor BBQ grill.

I use the merchandise points I accumulate for gifts throughout the year. Especially for last minute Christmas gifts. Everyone likes a gift certificate, so there is a quick and easy gift idea.

I know many people who have learned to maximize these rewards to the fullest. For example, you are use to just writing a check to pay for your utilities every month. Instead, just use the credit card to pay them, and just pay it off each month. It is not an added expense; you are just changing whom you write the check to. They also pay things like their homeowners policies on them and if you can, another big point gainer is paying your property taxes on them. You then can add a lot of everyday purchases and get your point totals very high.

So decide which type of reward program is best for you. You may want the cash rebate over the merchandise. Either way, make sure that you actually get to benefit from them. Check all the terms of your credit card, not all purchases you make will qualify for points or the cash rebate options.

Disposable Credit Card Numbers

Disposable diapers, disposable cameras- and now… disposable credit card numbers? They're actually referred to within the industry as virtual credit card numbers, and are currently being offered through most major credit card issuers.

Virtual credit card numbers are single-use numbers that expire within a month or two of issue, and are used for shopping online in place of the number that's actually on your credit card. What's the point? The number is only good at the one web site where you make your purchase, and only for a limit period of time- so if hackers have obtained your credit card number during an online transaction, the next time they go to use it, it will not work.

When a customer receives their credit card statement after shopping with virtual credit card numbers, the purchases show up on the statement exactly like any other purchase. Some card issuers will provide the virtual number used to make the purchase along side the charge, for reference purposes.

Why Virtual Credit Card Numbers?

One of the main reasons why some people choose not to shop online is because of their fear of credit card theft and identity fraud. The potential for personal information to be found online is a real concern- and is proven by a survey in September 2002, where over 7 percent of online shoppers surveyed claimed to be victims of credit card fraud.

Even though almost all credit card issuers promise a zero liability policy for unauthorized charges and online purchases, consumers are still concerned because of the potential for further damage. Sometimes it is difficult to get errors removed from a credit report, for example, even after being the victim of identity theft. Using virtual credit card numbers can eliminate the potential for hackers to use the card data to make purchases and discover more information about a consumer.

Disadvantages of Virtual Credit Card Numbers

While virtual credit card numbers offer many advantages over shopping online with your regular credit card number, there are also some instances when using a virtual card number has disadvantages.

When you purchase theater tickets or airline, hotel or rental car reservations with a credit card number online, you are supposed to provide that credit card when you go to pick up your tickets or when you check into the hotel or get your rental car. If you've used a virtual number, you won't have the ability to hand the clerk the credit card with a matching card number.
Recurring expenses are also a hassle using a virtual credit card number. By the time the next purchase period comes around, your number is likely to have expired.

Take Precautions Against Identity Theft & Fraud

You can take some precautions to help minimize your potential to be a victim of online fraud due to shopping online- with or without having a virtual credit card number.

Before making a purchase, make sure the website uses a secure or encrypted site to handle the transaction of your payment information. Most sites use the SSL (secure socket layer), and is recognized easily by a url beginning with 'https' instead of 'http', and often by a little locket symbol on the screen.

Always monitor your credit card statement and make sure all transactions were authorized. If you suspect there is a problem, contact your credit card company immediately.

Use a paper shredder to destroy credit statements, pre-approved credit card others, bills and anything else containing personal information before you throw them away. While many identity thieves are high-tech and use the internet to find their victims- some still dive into dumpsters to get their information!