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Credit Card Holders’ Bill of Rights

April 30, 2009 | Credit Cards | No Comments

Good news for credit card holders! Especially for people who carry a credit card balance.  Legislation is about to be passed to control credit card practices.  The new legislation has bipartisan support and a swift passage into law is expected.

The new so-called “Credit Card Holders’ Bill of Rights” is designed to:

  • Enhance protections for credit card customers.
  • Prohibit so-called double-cycle billing which eliminates the interest-free period for consumers who move from paying the full balance monthly to carrying a balance.
  • Prohibit retroactive rate hikes.
  • Ban the issuance of credit cards to people less than 18 years old.
  • Customers must receive 45 days notice before their interest rates are increased.
  • Clear explanation of credit card agreements instead of the fine print, which is hard to decipher.


The new laws will take effect a year after enactment. However, the new legislation that customer receive 45 days notice before their interest rates are increased would go into effect in 90 days.

According to a study by the law firm Morrison and Foerster; the new credit card legislation could cost the banking industry more than $10 billion a year in interest payments.

Currently, U.S. credit card debt is $963 billion, a 25% increase of the past 10 years. According to, the average outstanding credit card debt for U.S. households was $10,679 at the end of 2008.

There are about 16,000 U.S. companies that issue credit cards. The largest lenders are Bank of America, Citigroup, Discover Financial Services, JPMorgan Chase & Company, American Express, Capital One Financial Corporation and HSBC Holdings PLC.

How to Easily Make 14% Return on Your Money

April 24, 2009 | Credit Cards | No Comments

According to Index Credit Cards, below are the average interest rates for credit cards:

  • Consumer credit cards:  14.17%
  • Non-reward consumer credit cards: 12.80%
  • Reward credit cards: 14.76%
  • Student credit cards: 14.15%
  • Business credit cards (non-reward): 11.77%
  • Business reward credit cards: 12.84%


Many of us aren’t happy with what banks are currently paying us in our savings account.  However, if you carry a credit card balance you will get a nice return on your money if you simply pay off the credit card balance 100%.  Think about it; your bank is paying you 0.05% interest on your savings account, but you pay your credit card company 14% interest.  What’s wrong with that picture?

If you have investments in stocks, bonds, mutual funds, etc. and still have a credit card balance, unless your investments are paying you more than the interest charged by your credit card, you need to liquidate your investments and pay off the credit card balance ASAP, thus getting you 14% return on your money!

Get Cashback Using Microsoft Live Search for Shopping

April 21, 2009 | Credit Cards | No Comments


Microsoft has created a new incentive program to encourage consumers to use Live Search for shopping.  The incentive is that you get cashback savings by using Live Search to find deals on the products you want from the stores that you know and trust.

Here’s how Live Search cashback works:

  1. You first search for cashback deals at Live Search cashback. Each time you click a Live Search cashback listing, you’ll find deals on the product you chose. Your results will list the cashback savings you’ll receive off the store price, and your final bottom-line price that includes tax and shipping costs.
  2. Second you compare and sort products by the bottom-line price. Click the best deal to go to the store. Everything you buy during that store visit will be eligible for Live Search cashback. On your first time using Live Search cashback, you will be asked for an email address so you can be notified of how to quickly set up your free cashback account.
  3. Each time you use Live Search cashback you then continue to save money.  Every time you make a qualifying purchase, an email is sent to you to confirm your Live Search cashback savings. Usually 60 days after your purchase (although this time period may vary for some stores), and when your cashback account reaches a balance of at least $5, you can claim your cash.

For more information visit

Should You Move Your Investments to Cash?

April 20, 2009 | Credit Cards | No Comments

We are all tempted to shift our assets out of stocks into cash, especially in our 401K plans where most of us have taken a beating over the last several months.  However, remember when investing in stocks and mutual funds it’s never a realized profit or loss until your sell.  If you sell now, you’ll lock in your losses.  But if you shift to cash in a bear market, you are likely to miss out on an eventual rally.  Rallies tend to occur quickly and compressed.

The best way to survive a bear market is to stick to your plan no matter how far the market falls. Keep contributing to you employer-sponsored retirement savings plan and allocate your assets in bonds, stock, and fixed income based on when you will retire.

Below is a graph that shows the outcome of a hypothetical portfolio worth $100,000 at the market’s peak on January 1, 2001.  That chart shows that if the hypothetical investor had moved to all cash at the market’s bottom, the investor would have missed out on a substantial growth opportunity.  After 3 years, the investor would have missed out in $33,197 in gains after 3 years and $55,200 in gains after 5 years had the investor moved his money in cash.

Chart: Move to Stocks vs. Stay in Stocks


Source: T.  Rowe Price

Remember that over the past 80 years, through all the bear and bull markets, stocks still returned about 10% yearly, on average.  One hundred dollars invested in stocks at the start of 1926 would have grown to $324,600 by end of 2007, despite the Great Depression, World War II and 14 bear markets.

Get Your Free Financial Software at

April 19, 2009 | Credit Cards | 1 Comment

If you are looking for software to manage your money you don’t have to spend a dime.  Forget purchasing Quicken or Microsoft Money who forces you after 2 to 3 years to upgrade by paying even more money.

Consider which is a free open-source desktop that helps you to manage personal and small-business accounts, create detailed report graphs, categorize cash flow and downloads stock quotes via the Internet.

Gnucash can import QIF files from Quicken and comes with an online-banking feature that allows you to reconcile your credit-card and bank statements without entering the data manually.

Keep in mind that there are Internet-based applications also available for free that can also help you track your online banking, credit cards, loans and investment accounts.

Free online financial applications can be found at:

Does Fannie Mae or Freddie Mac Own Your Loan?

April 17, 2009 | Credit Cards | No Comments

Do you know if your mortgage loan is owned or guaranteed by Fannie Mae or Freddie Mac?  If it is, you may be eligible for a Home Affordable Refinance or Loan Modification to take advantage of today’s low interest rates. Many homeowners don’t know that their mortgage company doesn’t necessarily own or guarantee their loan. 

You can easily find out online whether Fannie Mae or Freddie Mac owns or guarantee’s your loan by visiting their website or by calling their toll free number.  To look up your loan, you will need to enter street address and social security number (required by Freddie Mac).

Look up your loan at:


If your loan is owned or guaranteed by Fannie Mae or Freddie Mac, you can then determine if you are eligible for a Home Affordable Refinance.

You may be eligible to refinance your home if:

  • You are the owner occupant of a one to four unit home,
  • The loan on your property is owned or securitized by Fannie Mae or Freddie
  • At the time you apply, you are current on your mortgage payments (current means that you haven’t been more than 30-days late on your mortgage payment in the last 12 months or, if you have had the loan for less than 12 months, you have never missed a payment),
  • You believe that the amount you owe on your first mortgage is about the same or slightly less than the current value of your house,
  • You have income sufficient to support the new mortgage payments, and
  • The refinance improves the long-term affordability or stability of your loan.


To be eligible for a home affordable modification, you must:

  • Be an owner-occupant in a one to four unit property,
  • Have an unpaid principal balance that is equal to or less than $729,750 for one unit properties (there is a higher limit for two to four unit properties – consult your servicer),
  • Have a loan that was originated on or before January 1, 2009,
  • Have a mortgage payment (including taxes, insurance, and home owners association dues) that is more than 31% of your gross (pre-tax) monthly income, and
  • Have a mortgage payment that is not affordable, perhaps because of a significant change in income or expenses.
  • If you answered YES to all of these questions, you may be eligible to apply for a Home Affordable Modification. Only your servicer will be able to tell you if you qualify.


To find out more information visit

IRS Offering Special Tax Break for New Car Purchases

April 6, 2009 | Credit Cards | No Comments

If you are in the market to purchase a new car, now is a great time.  The Internal Revenue Service recently announced that taxpayers who buy a new passenger vehicle this year may be entitled to deduct state and local sales and excise taxes paid on the purchase on their 2009 tax returns next year.

The deduction is limited to the state and local sales and excise taxes paid on up to $49,500 of the purchase price of a qualified new car, light truck, motor home or motorcycle.

The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers.

IRS also alerted taxpayers that the vehicle must be purchased after February 16, 2009, and before January 1, 2010, to qualify for the deduction.

The special deduction is available regardless of whether a taxpayer itemizes deductions on their return. The IRS reminded taxpayers the deduction may not be taken on 2008 tax returns.