The CARD Act, signed into law last May, goes into effect today. Among other items, the new act will eliminate double-cycle billing, arbitrary rate increases and hefty fees for exceeding your credit limit. While many of these changes are positive, always read the fine print and be aware of credit card traps. Here is a brief summary of some of the changes the CARD Act will bring.
• In an effort to counteract the lost revenue credit card issuers may see due to the CARD Act, banks and other card issuers may begin implementing new fees or raising existing ones. Because the new law does not restrict the types of fees issuers can introduce, be sure you know exactly what you're being charged for.
• Credit card companies may begin placing restrictions on reward programs if you make late payments. To help avoid this situation, be sure to make your payments on time and read all notices sent by your credit card company, including those regarding changes to their rewards program.
• One of the primary benefits the CARD Act brings are a series of limits on how and when credit card companies can set interest rates. Previously, issuers could raise your interest rate just for missing a single payment without giving much notice. The CARD Act states that consumers must be alerted 45 days in advance before raising their rates.
Take time this week to assess your savings by taking action and developing a plan to improve your personal savings. The America Saves Web site is an excellent resource for additional tips and advice to help you set aside more. Also take this quiz to test your current financial literacy IQ while learning savvy saving tactics.
Visit www.FeedthePig.org for more money-saving tips
1 comment:
I've been getting the notices in the mail. I currently have 3 credit cards going. We are paying the minimum on 2 of them so we can concentrate on paying them off. We pay a large payment on the other one, the one with the highest interest. It's a plan and it is working. We plan on closing these accounts and using cash in the future. The card companies threaten us and say our credit rating will go down. I don't care. Not using credit is cheaper than having a good credit rating. I'll take my chances.
Most of this debt is buying the new home last March, paying to fix it up and move in, and the grand vacation we took last Summer, (priceless, as they say).
Peace.
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