Credit Card Debt
Many people not only avoid credit card debt like the plague, they actually view it as debt slavery. If you are suffering from massive credit card debt and are looking for a s0lution read the credit card debt reduction handbook.
As a credit card holder, it’s pretty much a given that you need to be on the lookout for increasingly deceitful practices from your credit card bank. I slipped up & just the other day was hit with a $29 “fine print bingo.”
Consumers are cutting back, and credit card companies are striking back! With more and more Americans saving more and spending less the credit card banks are really starting to take a hit – but… they are not taking the hit lying down!
Cutting back on spending and use of credit cards
Are you like me? In case this is your first visit to DebtFreeAdventure.com, I am in a raging battle against debt. Not just high interest debt, but all debt – yes… even mortgage and student loan debt. My goal is to be completely debt free as soon as possible – so it only makes sense that we should curtail our spending and use of credit. Sound like something you’re interested in?
Steps to reduce credit card and other debt
- Reduce Expenses – Ummm… yeah, my wife and I have gotten mighty creative and resourceful over the last 10 months.
- Curb Spending – Spending less than you earn is a cornerstone of gaining monetary wealth – we are proudly standing upon that cornerstone.
- Consolidate High Interest Debt – Tread lightly here because this only applies if you can secure a loan to consolidate your debts at an interest rate that is lower than the rates of all the loans you plan to consolidate, all while limiting the loan origination fee. Sound impossible? We found an awesome opportunity to “stick it to da man” by taking a Lending Club consolidation loan to do just that. If you want to figure out exactly how we did it check out my Lending Club review, it’s packed with good stuff.
As you can see, we have cut back on spending and use of credit. How do the credit card banks feel about this? Why they hate it of course… and I’m not the only one. Tons of Americans are suddenly waking up and becoming “debt wise.” It’s almost as if someone through a bucket of cold water on the whole country – and that is a good thing.
How are the banks responding to the decrease in consumer credit use? Here is what recently happened to me…
Ways credit card banks are striking back…
Watching this “frugality movement” must be making their blood boil, and to be completely honest… I love the thought of that! Can’t you just see the execs of Capital One, Citibank, etc. sitting around in a board room coming up with new ways to screw us out of our money? I love picturing them squirming in reaction to the wise daily decisions more and more Americans are making lately. BUT… they are no dummies. Every day they strive to find increasingly deceitful ways to separate us from our money. Here are some popular schemes to watch out for:
- Raising Interest Rates – It already makes me sick when I consider the amount of interest I pay each month… so what do the credit card banks do? Raise them higher of course. A few months back all three of our credit card banks sent us letters to inform us that they were doing just that. It was the straw that broke MY back – so I consolidated with Lending Club and haven’t looked back since. I’m loving the fact that while I still have to pay interest, I’m paying it to individuals rather than corporate credit card banks.
- Instituting Annual Fees and burying the evidence – About a week ago I received a Capital One statement in the mail saying I now owed them $29. I was like… “WHAT? I just paid that off like two months ago!” Well… the letter they sent me a few months back about raising my rates ALSO said – in fine print of course – they were instituting an annual fee on my card. It never had an annual fee before, and I had to dig back through my letters to find this little nugget. They just slipped it in on me. Chances are if they had sent a letter specifically about the annual fee I may have closed the account… so they buried it in the fine print. This raises another point – should we cancel a credit card account that we recently paid off if it is going to cost us an annual fee? Is the positive affect it has on our credit score worth the annual fee? You be the judge. The only reason I left the account open was because it bodes well for my credit score… now I am just inclined to close all the cards I recently paid off.
- Planned “Mistakes” – Yeah you read that right… “planned mistakes.” This occurs when the credit card banks mail your statements late, giving you less time to pay your bill before the due date. Another example is when you pay the bill on Friday, but they – very conveniently for their pocketbooks – do not process the payment until the following Monday… making your payment “late” and thus whopping you with a $36 late fee.
I guess what I am saying is…
I am mad that Capital One charged me $29 for a brand new annual fee, and I don’t want the same thing to happen to you!
Make sure you read all the fine print, and if it is too much of a hassle… just close the darn account – that way you are no longer subject to all the random deceitfulness of these tirelessly greedy credit card banks.
MAN I CAN’T WAIT TO BE DEBT FREE!
This article was featured in the 84th Edition of the Money Hacks Carnival over at MilitaryFinanceNetwork.com
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DFA is passionately dedicated to helping people break the bondage of debt and work toward financial freedom using biblical principles.
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