The Pitfalls of Credit Card Usage

We've all heard of that dangerous piece of plastic that some people carry in their pocket. This piece of plastic can be more addictive than heroin and cocaine, and sometimes it can have the same long term consequences. This piece of plastic is the credit card. Thousands of American's and people world wide area in debt created by credit cards. Credit cards are marketed so aggressively, that many consumers find it difficult not to own a credit card.

Credit cards are very simple devices that allow you to make purchases with money you don't have. If you pay them back in the first month you have no interest, and this process can be very important in credit building. Credit card companies do, however, make it just as easy not to pay off the debt. If the consumer doesn't want to or have the money to pay off the debt in the first month, then they simply pay around 20% more next month. At first this doesn't seem like a lot of money, for the benefit provided, but then you must realize that credit cards radically increase customer spending power.

When people go shopping with a credit card they effectively have no limit on what they can spend. Credit card companies are more than happy to increase credit limits in order to drive the consumer into a deeper debt, which, in turn will create a greater profit for the credit card companies. This slim plastic card or even just a series of 16 numbers in some cases can wreak havoc on a carefully planned budget.

After people have fallen into the initial trap of the credit card, then the credit card debt continues to compile. Eventually you are paying debt on the debt, in a process that economists call compound interest. Compound interest is one of the most powerful money making tools, but can also become one of the most deadly financial depleting weapons when turned against you. And in the case of the credit card this weapon is turned against you with both barrels loaded.

Credit card companies and banks target young people with offers that will allow them free stuff in exchange for creating a credit card account. Some stores even offer 30% discounts on your purchase just for the simple act of creating a card that allows you to purchase things with debt. These incentives seem like a great offer (their free, after all), but most people don't realize that credit cards and aggressive marketing will eventually overwhelm their financial and personal life.

The use of a credit card in a responsible manor is a required step in the process of building a credit history that will eventually allow people to buy a house. When using a credit card people need to be aware of the financial repercussions of their actions. Having a well paying job does not make you immune to the effects of credit card debt, and even the richest of the rich need to learn to charge responsibly.

Source: Associated Content

4 Reasons to Pay Your Credit Card Bill in Full

Do you dread each month when you are looking at your credit card bill? You are like many Americans who are overwhelmed with credit card debt. However, it is vitally important to your finances to get this under control as quickly as possible. I am going to list some reasons why it is important to pay your bill in full each month. If you are unable to pay the bill in full, you need to consider creating a strict budget and sticking to it, as well as consider obtaining a lower interest rate loan to pay your balances off, or even consider applying for a new card that allows interest free transfers for a certain period which will allow you to quickly pay the debt off.

Reason #1. Your credit rating. If you are only paying the minimum payment each month, you are setting yourself up for problems here. It is very important to keep your credit rating as high as possible so that your credit card balance does not provide a problem when you are looking to purchase a home or car. You want to make sure payments are paid off as quickly as possible.

Reason #2. Interest. Each month the balance is not paid in full, you are incurring interest charges. I liken this to going outside, making a nice little bonfire, and placing the money in your wallet in the fire one bill at a time. You are doing no better by carrying the balances on your bill. Interest rates are quite common to be around the 15%-20% range sometimes higher depending upon your credit score. This is a lot of wasted money each year that could be spent on things your family wants or needs.

Reason #3. This is similar to Reason #2. If you make a great purchase online for a wonderful item at a killer, price and you pay with your credit card you are not saving any money! If you save a couple of hundred bucks on the price of the item, but pay several hundred dollars in interest fees you are not saving any money, and are in fact paying more! Credit cards can hurt you in this respect.

Reason #4. Budgeting. If you are using your credit cards to pay your bills without paying off the balance every month then you have a budget problem somewhere. If you cannot afford to pay the balance each month then you need some serious budget revisions. When you are having to use credit cards to merely make ends meet there are huge budget problems that can create devastating effects on your credit report. There are several consumer-financing companies that can assist you in reducing your monthly bills, as well as getting a workable budget set up so that you are able to pay your bills each month.

As you can see, credit cards can be either good or bad for your budget, finances, and credit file. You want your credit to be as spotless as possible, and dragging balances over months is never a good idea. Good luck with all your credit cards and you should be able to work out all budget issues quickly with some work.

Source: Associated Content

Wired Plastic Prepaid Debit Card Review

I have been using my Wired Plastic Visa card for nearly a year. The program is a better alternative to All Access Prepaid Visa services. It does have its downfalls however. You are charged a monthly fee of $3.95 , for the privilege of using the card. It is accepted everywhere that accepts Visa. I would also like to point out that you are charged a fee of 95 cents every time you are required to use your pin number. Fortunately not many places ask for this info. In my experience I have only needed to enter a pin number at the grocery store. Additionally you are charged a fee of around $10 to activate your card.

The card is delivered to you quite fast once you request it. However there are some downfalls to using the Wired Plastic prepaid Visa. If you purchase gasoline at the pump, they will put a $50 hold on your account. Under normal circumstances this $50 hold is credited back to your account in a prompt and timely manner. However I have had several instances using the Wired Plastic prepaid Visa when I did not purchase gasoline at the pump , but I did occur "holds" or authorizations.

In my case I purchased my goods from the retailer, who I frequently shop with. I checked my balance several days later to find my transaction had posted, the retailer received the payment and I found I had an authorization pending for the same amount. It took over three months for my account to be credited for the amount which was pending. This made no sense at all considering the payment had cleared.

When contacting Wired Plastic for customer service issues you are left desiring much better service. To begin with it is not a toll free number for customer service, and at times you might be put on hold for quite a long time, which just runs up your phone bill. Also the customer service agents are not at all helpful. When I have had reason to call them for assistance I felt that the customer service reps went out of their way to be rude, and unhelpful. I actually had to be rude back on one occasion and request a supervisor, which I didn't get to speak to. I also had to resort to threats about contacting the better business bureau. They could make changes to greatly improve their service but I doubt that will happen anytime soon.

The good things about this card. It is easy to get. If you do not desire the commitment of a checking account this might be the card for you. You can direct deposit your paycheck into your account. You can also load your card via Western Union. That might be a nice feature for some people but I find the fees are too high for this service, it depends on the rates your local western union office charges.

You can use this card for pay-pal payments which is nice if you are doing business on line. All in all the card is affordable and convenient . Also Wired Plastic has a point program where you earn a point for each dollar you spend. You can only redeem the points for prepaid cell phone minutes. This is nice if you use a prepaid cell phone. However for some reason not all purchases earn points. I have no idea why and what the guidelines are as the company does not specify the details. If you don't have enough points for free airtime you will receive a discount of about $1 for every 200 points redeemed. I find it to be a much better value than the All Access Visa card. The fees are lower, and you are not charged a fee to check your balance via the phone, unlike The All Access Prepaid Visa. They were charging 50 cents per call for balance inquiries. When you think about it that is not a good thing when you have to spend money to find out how much money you have on your card.

About the best alternative to Wired Plastic I have found is Bank of America offers free on line checking with no monthly fees if you are able to open a checking account. The program is called My Access Checking and it is a reliable bank. It is definitely worth looking into if you need a checking account as well as a debit card. For those of you who would like to have a debit card without a major commitment Wired Plastic's Prepaid Visa should work out just fine for you.

Source: Associated Content

Online Credit Card Usage

Also, with the advent of the internet, has come the arrival of e-shops (electronic shops) and virtual shops that exist solely on the internet. Now, since we have e-shops and virtual shops we, consumers, are able to make purchases from these online stores using a credit card. This we can do by making use of the online store's credit card payment approval facility. Once our online credit card payments are accepted and verified, the purchased goods are delivered to our doorstep. This is purchasing convenience at its best.

Having more and more e-shops popping up everyday, online credit card usage is becoming more popular than ever. The option to receive online credit card payments has brought an entirely new dimension to shopping, for both merchants and consumers. Now, you can both shop from the comfort of your home and get discounted products purchased on the internet. This is makes shopping far more pleasurable. Shopping on the internet, you have no need to worry about the weather, traffic jams or other things needed to shop outside your home. Instead you can go to an e-shop, select product/s, and make use of the merchant's online credit card acceptance and approval facility, to make the payment for your goods. Then, all that is left to do, is wait to receive the products at your doorstep. Online credit card processing also makes starting an online business very easy.

As with almost anything else, credit card usage on the internet is not without its pitfalls. A pitfall of online credit card usage to guard oneself against is the possibility of online credit card fraud. Credit card fraud typically happens in two ways. The first way has to do with the online merchant that you are going to purchase goods from. This merchant may be a fraudulent merchant who takes your online credit card payment, but does not deliver the products to you. Moreover, they could use the credit card details you have put on the credit card payment form, for dishonest purposes. The second kind of fraud is committed by fraudsters who use spyware software and devices to intercept the details of online credit card payments. The spyware software captures keystrokes or takes screenshots of what you do on your computer and sends it to the spy. This type of online fraud is easily managed by using anti-spyware software designed to counter the effectiveness of spyware.

It is readily observed, the advent of online credit card usage gives a very useful purchasing option to consumers and merchants. However, caution must still be exercised when making online credit card payments. And, always remember, don't access your bank accounts or make online credit card payments from internet cafes, unless you are absolutely sure the internet cafe is reputable and rightly credentialed.

Source: Associated Content

How To Get the Right Credit Card To Meet Your Needs

When I migrated to the USA, I was amazed to see that almost all the people have credit cards and more than one. Some of my friends and relatives have four or more credit cards. I got my first credit card through my son, as a secondary cardholder, and my son made the payments as the bills were coming on his name only as he was the primary credit card holder. I started my own survey/research to get my own credit card in my name so that the bill of the credit card would come in my name. In the meantime, I opened both a saving and checking accounts with Wachovia and Chevy Chase banks. Both these banks offered me their credit cards but I did not opt for them. I was still trying to get the optimum deal for my new credit card.

Finally, the deal came in the form of a letter from American Express. They offered me the City bank credit card free of cost for the first year. This offer came through American Air lines, where I am a member of American Advantage mileage. The most attractive part was that if I accept that credit card and make my first purchase on that credit card, I was to be credited with 20,000 miles to my American Airlines mileage account. These mileages are sufficient to earn me a free round air ticket of American Air Lines for any destination in the USA. I immediately applied for this credit card with my financial details and I was issued the credit card within 3 weeks. The credit card was having a credit limit of $8000. Moreover, I was credited one mile in my American Advantage account for the every dollar spent by me through this credit card. I have been using this credit card since last 8 months and my American Advantage miles score have reached up to 29000 miles, enabling me to buy a round fare air ticket of American Air Lines even in first class for any destination in the USA. As I have to travel frequently in the USA, this credit card proved very beneficial to me. Subsequently, I applied for the similar credit card for my wife and got the same. Her American Advantage miles are also around 29,000. This is the most optimum deal I could get for having our own American Express City bank credit cards.

I have made the entire operation of both these credit cards online on the web site This saved me my physical visits to the bank or any postal expenses for the payments of the credit cards bills. This online operation is very easy and effective as you can view your monthly statements of the credit cards online and even can pay the bills online by linking up your bank account with this credit card account. Such a procedure is immensely helpful to the senior people like us who find it difficult to go out on their own. This scheme is still going on and all my AC friends can avail it to derive maximum benefits. It will be required to become a member of American Advantage Mileage program to get entitled for such credit card. This can easily be done by logging into the website

The points earned through such credit card in American Advantage program can be helpful to all of us even if we do not intend to fly in near future. You can sell your American Advantage miles on the web site This web site offers cash money as well as the gift cards for the various stores in lieu of the AA points. You can easily get around $200 in cash or gift card for about 20000 AA points. If you accumulate your AA points up to100, 000 points, you may be able to get a round trip international air ticket also. As soon as you complete one year of this credit card, there are two alternatives with you. One is to stop the card after one year. The other is to pay the annual fee of $50 for the next year. As soon as you pay $50 annual fee for the next year, your AA account will immediately be credited with 5000 points. However, my advice is to stop the credit card after one year and look for such other schemes. The only catch in this scheme is not to forget closing the credit card before one year is completed as otherwise, annual fee of $50 will be charged to your account immediately.

I feel that new senior immigrants like us should not miss this opportunity, as it would be highly beneficial to all of them.

Source: Associated Content

Choosing the Right Credit Card

Are you interested in acquiring a new credit card? If so, you are definitely not alone. Each year, a large number of Americans consider applying for a new credit card or accepting a credit card offer that was extended down to them.

When it comes to getting a credit card, you will find that you, literally, have an unlimited number of options. There are hundreds of credit cards that you can choose from, many of which have different fees, "perks," and so forth. For that reason, it is important that you take the time to choose the credit card that is best for you and your needs. Should you not do so, you may be preparing yourself for financial hardships in the future. A few of the many points that you will want to keep in mind, when looking to acquire a new credit card are outlined below.

Know What You Are Singing Up For
All too often, many individuals end up signing up for the first credit card offer that comes their way. This is most common with first-time credit card holders and those in debt. Before agreeing to a credit card contract, you are advised to fully read it. Of course, you will want to be on the lookout for high interest rates or credit card offers that are stacked with fees.

Determine What You Will Be Using Your Credit Card For
When it comes to choosing the right credit card, its use is extremely important. For instance, if you are planning on having a credit card for emergencies, you will want to pick one with a low line of credit. You will also only want to have one credit card. Having a large line of credit or more than one card, when you don't need one, will not only cost you money, but it may also cause you to accumulate debt.

Determine How You Will Be Able to Payoff Your Credit Card Balance
Credit cards come in a number of different formats. For instance, there are some that come with low interest rates; however, those are sometimes difficult to qualify for. If you are planning on paying off your credit card balance each month, the interest rate may not be as big of an issue for you. That, however, does not mean that you should automatically go right out and obtain a card with high interest rates. However, you may want to be on the lookout for credit cards with other benefits.

Beware of Introductory Offers
Credit card offers are often introduced with introductory offers. Introductory offers are just what they sound like; they are only for a limited period of time. When it comes to introductory credit card offers, you will often find low introductory interest rates or low credit card fees, such as yearly or monthly fees. Although the introductory rates may sound enticing, it is important to remember that they will not last forever. You are advised to learn what your interest rates or other credit card fees will be after the introductory period ends. If they sound too high, you should start to look elsewhere.

By keeping the above mentioned points in mind, when looking to acquire a new credit card, you are more likely to find the credit card that best suits you. As a reminder, this is important, as the wrong credit card can literally become a financial trap.