The economy is slowly recovering from one of the worst recessions we have seen in decades. As it starts to recover, people will also begin to make more purchases to boost it. This consumer spending puts money back into the economy and creates demand that leads to new jobs. It is a cycle that keeps our country afloat. When we started this horrible recession, the Government decided that banking was somewhat at fault for the problems we were experiencing and decided that credit card spending and bank fees for certain services were out-of-line and needed to be changed. So, starting on July 1st, banks can no longer charge overdraft fees to those who have exceeded their balances. This will severely limit the amount of money a bank can make on its customers. Many people do not realize that a bank makes a great deal of money on overdrafts fees as many people use their debit cards and go over their limits.

Bank of America has decided to implement this change right now rather than wait. Rather than allow their customers to go over limit, Bank of America will now stop purchases if they exceed the balance in their account. Many people do this unknowingly as they are not aware of certain transactions taking place on their account and with current salaries at a low, many are purchasing items dangerously close to the bottom of these accounts. With current trends, the banks stand to lose millions of dollars in revenue from fees as well as purchases.

As of July, banks will have to get the consent of their customers to charge any overdraft fees and Bank of America is well aware that it would be an uphill battle and that their customers will not sign these types of guidelines. Rather than fight it, Bank of America has decided to institute the new laws now to possibly keep customers and show that they are not predatory like the Government seems to portray than as in the media. Many of the larger banks will fall in line with Bank of America as they all scramble to find new and inventive ways to charge fees. It is likely that fees for checking account maintenance will go up as well as yearly fees on credit cards, which is already occurring across the board.

In the past, students were besieged with credit card offers a few years before graduation. The cards proved too tempting to most college students who weren’t informed enough to use them responsibly, leading to a significant debt burden upon graduation. Whether that situation was a problem of poor financial management on the part of the student or aggressive credit card tactics that targeted a vulnerable demographic, changes have now been made. While much of what is happening is good news, other people fear it can lead to an increase in other types of loans amongst college aged students, most notably payday loans.

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Financial regulations are in the works to revamp the credit card industry. There will be limits put on late fees and interest penalties. While that’s a welcome reprieve for many credit card holders, what this actually means is that credit card issuers are going to be quite tough with their lending practices. Fewer people will receive offers, and those that do will have much different terms to contend with on the new cards. It will make other forms of financing, like payday loans, much more attractive than in the past. (more…)

Credit card debt is something that many millions of consumers face on a daily basis. As the economy starts to recover, we often find ourselves in more debt due to economic hardships that had become unavoidable. We must now find a way to get out of debt and restore our financial independence. The real question is, can we afford to pay these minimum payments monthly and how will we ever get out of debt that way?

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When you need to make a purchase but do not like carrying cash with you, a debit card is a great tool. The bank releases the money electronically for the purchase just like cash and your account is debited the amount, hence the name. This can be a convenient way to pay for anything and a way to carry little cash as most stores take debit cards as a form of payment. As with every type of payment, there are downsides to debit cards that are often overlooked. It is important to know the risks and the rewards of any form of payment and consider them before using any debit card for purchases whether online or at your local store. (more…)

Credit card debt has been mounting this past year as Americans are sometimes using their credit cards to stay afloat during these turbulent times. As the economy has gotten worse, consumers are often turning to their credit cards and cash advances to make ends meet including bill payments, groceries and energy bills.  (more…)

It is important to keep track of our spending so that it does not get out of hand. We should budget and write down the money we spend everyday so that we do not go over our balance and get charged a late fee. These fees can be as much as thirty dollars and since they are charged when we are over our balance, it just adds to our misery. Some people go as far as to use prepaid Visa cards so that they can keep track of money online and add funds to the card when necessary. It is an easy way to make sure that you do not go over your balance and spend money that you just do not have in the bank. (more…)

Credit card debt is something that most Americans live with and the current credit crisis has had an effect on the amount of credit available to consumers. As credit freezes, less capital is available to these credit card companies to lend. Unfortunately, money flow has been slow due to the mortgage crisis and many have been slow to pay their payments. Defaults on credit cards are happening daily as many struggle to stay afloat with mounting job losses and lack of overall funds. As unemployment increases, so do defaults of every kind, resulting in car repossessions and home foreclosures. A recent bill has been passed in Congress that will protect consumers from any unreasonable practices perpetrated by credit companies. (more…)

Is it a good idea for a college student to carry a credit card? Most people, especially experts, will tell you no. Simply put, it is widely believe that college students are not mature enough to carry a credit card. Instead of using this money for important items such as books, it is thought that they will blow their credit at the bar, on junk food, on clothes, etc. Does all of this make sense?

Just like any consumer, some college students can responsibly carry a credit card and others won’t make it a few days without messing up. If your college-age child is interested in applying for a credit card you should talk to them about this situation. Ask them why they want a credit card, what it will do for them, how they are going to use it, etc. You may open their eyes to the fact that applying for a credit card is not the best of ideas.

Unfortunately, most credit card companies don’t have any issue lending money to college students. They know that college kids spend money, and of course, they can hit them with high finance charges that are sure to work in the favor of the creditor.

It is hard to say for sure that all college students should stay away from credit cards. But one thing should be remembered: in order to carry a credit card, no matter your age, you need to be financially responsible.

That all important credit rating can make a big difference to what loans you can get and how much interest you’ll pay, so these tips on ways you can ruin your credit can remind us of the best ways we can act to be sure we don’t damage our credit score, wherever possible:

• Don’t forget to pay a bill on time. Sure, if you can’t get to the post one day and your payment arrives a day late - one time only - it’s unlikely to have any effect on your credit score. But make it a habit to pay your bills on time or early.
• Don’t spend up to your credit limit. The ratio of your debt compared to your credit limits is a big factor in calculating your credit score. Experts recommend spending no more than 10% of your credit limit.
• Don’t cancel all your old credit cards. Keep one or two credit cards that you have a long history with as this will help your credit score.
• Don’t sign up to a dozen new cards a year. Ignore all the offers that land in your mail box. Stick with the cards you have and your credit score will like you a whole lot more.
• Don’t borrow money you don’t actually need just because somebody thinks it will help your credit score.