Calling All Business Owners: Tips on Your Phone Service that Will Save You Money

This is a guest post by Nicole Hayward, Marketing Director at Junction Networks.

If you are a start up or small business owner, odds are you’re going to need a business phone service. (You’re not going to tell prospective clients to call your cell phone much longer…) Here’s a tip that’s going to make your business look bigger, better, and smarter: Use a Hosted VoIP service.

What is Hosted VoIP?

Voice over IP (VoIP) is the growing technology that allows you to make phone calls over your internet connection. You may associate Skype with VoIP, which is an app that allows you to call another Skype user. However, there are phone services that integrate with the Public Switched Telephone Network (PSTN), allowing you to make and receive phone calls like you would on a traditional phone.

Because of its relatively new emergence to the market, a VoIP service may seen intimidating. But, I’m here to assure you it’s actually cost efficient, reliable, AND easy to set up!

Why is VoIP Great for Small Businesses?

First and foremost, VoIP is great for small businesses because of its cost efficiency and ease in setting up. Frankly, if you choose a hosted VoIP service, you won’t need to pay a phone company to wire a business phone at your office or home. Instead, you’ll sign up for the service, purchase an IP phone to plug into your internet connection, and you’re set. Also, the actual phone service is cheaper because long distance calls are essentially local calls; voice data travels over the internet until it reaches a local PSTN to transfer to the recipient.

Secondly, VoIP has great features and scalability. You will find, using a hosted VoIP service, that you can choose a package that fits your business needs and budget. “This technology allows for businesses to take advantage of services like auto attendants, conference bridges, voicemail servers, video conferencing, click-to-call website integration, business hours routing, and voicemail-to-email notifications…” says TechCrunch. In addition to these features, you will be able to:

• Add users (extensions) in a matter of a few clicks as your business grows
• Answer your phone from the road using a smart phone app or your laptop in your hotel room
• Transfer calls to your remote employees with extension dialing (available with some services like OnSIP)
• Take your phone system with you when you move to a new office.

How Do You Get Hosted VoIP?

Well, of course I am biased, since I work for a great Business VoIP Service, OnSIP. You can easily sign up and try our service. But, feel free to weigh your options by Googling “Business VoIP”. Remember if you choose Hosted VoIP, all you will need are IP phones (e.g. Cisco or Polycom) and a broadband connection. Or, you can always email me with questions. Good luck in growing your business and communications!

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Nicole Hayward is the Marketing Director at Junction Networks, the creators of OnSIP Business Phone Service. Joining the software development industry after a traditional engineering education, she became passionate about discovering new software tolls for business efficiency and success. Follow Nicole and the rest of her team on Twitter @OnSIP and on the OnSIP blog. Or, you can email her at Nicole [AT] JunctionNetworks [DOT] Com.

Citibank Prints Social Security Numbers on Envelopes Sent to 600,000 Customers

Unless you’re that guy from the LifeLock commercials, you really don’t want to have your social security number paraded about like it isn’t the one and only thing a person needs in order to steal your identity and ruin your credit and everything you have worked for your entire life. Well, that is unless you have the common sense that Citibank possesses; which is, well, none that we can see from what was uncovered in late January.

Way too many companies have put their customers at risk by mishandling private information and we can now add Citibank to that list of companies. In late January, Citibank sent out about 600,000 envelopes–with their customer’s social security numbers printed on the front. But Citibank claims that this is not as severe an offense as we may think; in fact, no one could know that there were social security numbers printed on the envelopes because Citibank had combined the numbers with a larger string of digits and letters that resembled more of a mail routing number than a social security number. Customers were made aware of this incident as part of Citibank claiming complete transparency and they had also given their customers the option of enrolling in six months of credit monitoring at no cost.

There is absolutely no excuse why Citibank thought it wouldn’t be a big deal to print their customer’s private information that could potentially ruin everything they have worked for financially thus far; having people’s social security numbers come printed on envelopes from their bank, albeit being jumbled with other letters and numbers is nothing more than a gross display of neglect. There is not one inkling in my mind at the moment, after hearing about this, that could lead me to believe that Citibank truly has their customer’s interests at heart. If a financial institution does not think it’s important to keep my social security number to themselves, what other information will they feel perfectly fine handing over to strangers?

In lieu of this mishandling of personal consumer information, the Privacy Rights Clearinghouse has offered advice to consumers on how to deal with a security breach.

New Credit Card Statements Could Help Consumers Decrease Debt

This is a guest post by Bill Hardekopf, CEO of LowCards.com.

Consumers will soon receive their first credit card bill since last week’s implementation of the CARD Act and their statement will look very different.

“The new debt information on your credit card statement is one of the best provisions of the CARD Act and it will benefit every cardholder,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook.

The most significant change in your statement will be a chart which will clearly show how long it will take and how much you will actually pay should you make just the minimum payment each month. In addition, the chart will display how much you need to pay each billing cycle in order to completely pay off your balance in three years.

Suppose you owe $3,000 and your interest rate is 14.4%. Your statement would show that if you made no additional charges and paid only the minimum payment, it would take almost 11 years to pay off the balance at an estimated cost of $4,745. In addition, it would show that if you wanted to pay off the balance in three years, you would need to pay $103 per month and it would cost an estimated $3,712.

“Consumers will be shocked at how long it takes to pay down a balance and how much interest is actually paid if you are only making the minimum payment. When people see this personal information clearly presented in black and white, it should have a significant impact on getting consumers to pay off their credit card balance in a much more timely manner. Cardholders can’t ignore reality when they see the numbers each month on their credit card bill,” says Hardekopf.

An example of the minimum payment table can be found on the Federal Reserve website.

Consumers will see several additional changes on their credit card bills:

• Your statement should be much easier to understand. Fees and interest charges should be highlighted and explained in simple language in a legible font size, not buried in fine print.

• Your statement should give a toll-free number for counseling assistance from legitimate nonprofit organizations. Issuers are required to provide contact information for three organizations that have been approved by the United States Trustee or a bankruptcy administrator to provide credit counseling services in, at the card issuer’s option, either the state in which the billing address for the account is located or the state specified by the consumer. The National Foundation of Credit Counseling (NFCC) has added help lines to meet the expected increase in consumer assistance under the government’s new regulation.

• Some issuers will give a summary of total fees and interest paid to date during the current billing cycle and year to date.

Not only will your bill look different, but the delivery and due dates may also be different. Pay attention to the due date because it is possible that your due date has changed as a result of the provision that requires at least 21 days notice before your due daye. Your due date now has to fall on the same day every month. The payment cut-off time cannot be earlier than 5PM on the due date. If your payment due date falls on a weekend or holiday (when the company does not process payments), you will have until the following business day to pay without penalty.

These statement changes may belimited to or be most effective for those with paper statements. If you have online banking without a paper statement, you will miss these numbers about your debt. You may have to go looking for it in a PDF file instead of it being delivered directly to you. According to a recent AP story, the biggest banks are not putting the minimum payment on the online account summary page. Bank of America, Chase, Citi and others say they are educating customers through mail and email about the new statements. Capital One is using banner ads about the new disclosures when cardholders log on.

“Banks should act in the spirit of the CARD Act and also make the minimum payment information easily available to online accounts,” says Hardekopf.

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LowCards.com simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1260 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for eight years.

Significant Credit Card Changes Proposed by the Federal Reserve

This is a guest post by Bill Hardekopf, CEO of LowCards.com.

Today, the Federal Reserve proposed a rule amending Regulation Z (Truth in Lending) to protect credit card users from unreasonable late payment and other penalty fees, as well as requiring credit card issuers to reconsider increases in interest rates. This rule will go into effect on August 22, 2010.

“This proposal addresses two key costs of using a credit card–fees and interest rates,” said Federal Reserve Governor Elizabeth A. Duke. “The rule would prevent credit card issuers from charging large penalty fees for small missteps by consumers and would require issuers to reevaluate rate increases imposed since the beginning of last year.”

The proposed rule would:

• Ban inactivity fees. Some issuers have recently instituted an inactivity fee if there are no transactions on your credit card for a certain period of time.

• Force issuers to evaluate rate increases. At least every six months, credit card issuers must reevaluate annual percentage rates increased on or after January 1, 2009 and if appropriate based on their review, reduce the annual percentage rate applicable to the account. This includes changes in the consumer’s creditworthiness, and to increase in the rate due to change in market conditions or the issuer’s cost of funds. However, the statute also expressly provides that no specific amount of reduction in the rate is required.

• Stop credit card issuers from charging penalty fees that exceed the dollar amount associated with the consumer’s violation of the account terms. Card issuers would no longer be able to charge a $39 late fee for a $20 minimum payment. The fee could not exceed $20.

• Require credit card issuers to provide reasons for increases in rates.

• Prevent issuers from charging multiple penalty fees based on a single late payment or other violation of account terms.

“These are significant changes in the credit card industry that will help every cardholder. But if history is any indicator, credit card issuers will find new ways to make up for the revenue they will lose when these rules take effect in August, and those changes could be in the form of new or increased fees,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook.

This proposed rule represents the third stage of the Board’s implementation of the Credit Card Accountability Responsibility and Disclosure Act of 2009. In July 2009, the Board issued a rule implementing the provisions of the Credit Card Act that went into effect on August 20, 2009. In January 2010, the Board issued a rule to implement the provisions of the Credit Card Act that went into effect on February 22, 2010.

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LowCards.com simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1260 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for eight years.

The Unintended Consequences of the Credit CARD Act

This is a guest post by Bill Hardekopf, CEO of LowCards.com.

On Monday, February 22nd, the major provisions of the Credit CARD Act took effect, nine months after they were signed into law.

Many of these provisions will have a very positive effect on consumers, but the law has resulted in some unexpected fallout.

“The CARD Act has some very significant benefits for credit cardholders. The restrictions on interest rate hikes and the ban on over-the-limit fees are tremendous. Consumers have cried out for these protections for years and they are finally about to take effect,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook. “However, there are a number of unintended consequences that have resulted from the CARD Act. These changes might affect more credit card consumers than the law helped.”

Here is a look at some of the unintended consequences of the CARD Act:

• Since issuers will be unable to raise interest rates on new accounts for twelve months, they simply raised the advertised APR before February 22nd so it affected everyone shopping for a new credit card account. According to the LowCards.com Complete Credit Card Index, the advertised Annual Percentage Rates for credit cards averaged 13.46% last week. Six months ago, the average was 12.11%. One year ago, the average was 11.51%.

• People under 21 will find it harder to build their credit score. If they do not have a job with enough income, they must get an adult to co-sign. Many young adults will not take this extra step, losing out on the opportunity to build up a good credit history throughout college. Without a positive credit history, they may not receive as good an interest rate on their first house or car loan.

• Fees, fees and more fees. Issuers are introducing more cards with annual fees, increasing existing fees, and putting new fees on accounts. Last October, Bank of America notified a small percentage of their customers that it is adding an annual fee of $29 to $99 on their accounts beginning in February. Balance transfer fees, which have been at 3% for most issuers, have now been increased to 5% by Chase and Discover. Firth Third Bancorp recently added a $19 inactivity fee if your card is unused for a twelve month period.

• The scarcity of fixed rate credit cards. Most issuers switched their fixed rate cards to variable rates, since the CARD Act allows APR increases in variable rate cards if the index used to calculate that variable rate increases. As an example, if the infex for a variable rate card is tied to the prime rate and the prime rate increases by 1%, the APR on that card can increase 1%. Many issuers switched their fixed rate cards to variable rate cards so they could maintain their margins once the CARD Act was instituted.

• Since any amount above the minimum payment goes toward the balance with the highest APR, some issuers raised the minimum payment up to 5% on a number of accounts.

• A decrease in the amount of credit card rewards or cash rebates. Reduced rewards could come in several different forms.
  • A cutback in the payouts of cash back cards.
  • More miles or points needed for that free airline trip or hotel stay.
  • Higher tiers required for consumers to receive the same level of rewards.

• A decrease in the number of credit cards awarded by retail stores. Providing proof of income when applying for a credit card will make it significantly harder for consumers to instantly qualify for a credit card. This will certainly impact the marketing efforts of the 10-15% discount on a purchase if you sign up for a store’s credit card. Retailers rely on this marketing strategy to increase purchases and to build their mailing list of customers used for offering future coupons or early-bird discounts.

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LowCards.com simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1260 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for eight years.

Blogging Schedules: It May Never be “Good Enough”, but that’s Okay

The blogosphere is made up of countless blogs on an exuberant amount of different topics. There is literally about 500 different blogs that appeal to every one person. That is how big the blogosphere is. While there are so, so many different things people bring up, explore, dissect and discuss on their blogs, when you cut through all the clever wording used to describe what a particular blog is all about what type of content you would expect to find there, there are mainly two different types of blogs–those used to detail, rant and rave about one’s life and blogs built and written by and for corporations. As more and more people start opening up and divulging just about everything that goes through their heads to their prospective audiences and as more corporations seek to identify and connect with their consumers, the line between these two, seemingly separate blog types continues to blur where we, the blog readers, see our favorite blogs writing about and being sponsored by corporations. Before the most recent FTC guidelines have been put into place, most of the time, blog readers did not know when we, bloggers, were just sharing information or were being compensated in some way for what we wrote about products and businesses.

As this already very thin line continues to blur, people who began blogging to divulge, rant, rave and detail their lives on the internet are evolving their blogs into their businesses and in some, albeit rare cases, a person’s blog makes up their entire of the bulk of their household income. While most people put the emphasis of being compensated for blog posts, advertisements and the like on mommybloggers, this trend has and will continue amongst any and all blogs with a significant audience that is deemed a “target audience” by consumers.

Woman Tribune started out as a business-like blog. It was not created merely to divulge about my life, although I have done just that on several occasions and will undoubtedly continue to do so as long as Woman Tribune is up and running, but it was created more-so to provide information and to explore and discuss information that is important and significant in the lives of women everywhere. To put it bluntly, Woman Tribune was created as a business, rather than something fun to do in my down time and because of that, Woman Tribune has always operated with a business-like platform. One of the major things to keep in mind when creating a blog with the purpose of it being a business in mind is that it must always contain recent information. While I do my best to post about relevant, interesting and varied topics, if I let Woman Tribune sit for a few days with no content going up after a number of days, it is pretty much the equivalent of committing blogosphere suicide. It starts to become irrelevant, something easy to gloss over and it becomes forgettable. So obviously, knowing that not only is content king in the blogging world, but frequent content is also king and something that must be kept in mind to sustain your blogging/business, the thought of blogging schedules is guaranteed to come up in your mind at least, oh, about 150 times. A day.

Blogging schedules are tricky. Every “professional blogger” or “internet/blog marketer, “interblog marketer” if you will, repeatedly states in just about every five posts for about five years straight to post on your blog as many times as you’d like, but around the same time every day in order to set your readers on a schedule and give them something to look forward to. This is all well and good, in theory, but can become quite a mess in no time and without any effort.

Firstly, trying to get my readers on some sort of “schedule” of when to expect my new posts seems a little weird to me. A little like parenting and why would I start treating my readers like my children when most of them already have children of their own? To add to this, because most of my readers do have children of their own, that means that while they probably love, and even fantasize, about the thought of having some semblance of a schedule, in reality, that is really not given to most parents. Adding to that, for a blogger to be available at around the same, exact time every day in order to update their blog makes it sound like they are lacking a life, which then again may be why they make the money and can be considered interblog marketers in the first place. Just sayin’…

I have always been a night owl; there is just something about the dark and the quiet that really jump-starts my mojo and really puts me to work. I tip a significant hat to the night time as being a key factor in my web design/development talents and for putting my natural knack for the English language to work as a writer early. I have been on the internet, designing and developing websites, writing (mostly) bad poetry and blogging since I was 13 years old. That is an entire decade of this stuff and for the longest time, I honestly had no idea what I was doing, but it worked and I built a name for myself in the political and feminist blogging worlds early. I thought I had some sort of an idea of what I was doing, but as I founded Woman Tribune and found myself enthralled with this new “blogging business” everyone jumped on the bandwagon of over the course of the past few years, I realized that in order to treat this business like a legitimate business, I was going to have to adapt to some business hours. This is exactly where my blogging schedule goes a bit haywire. Because I am a night owl, I am very often up all night (it’s 5:11am here right now and I have not yet been to bed. You obviously get the picture.) and because of this, I am usually not awake during “business hours,” ie: 9am to 5pm. A lot other bloggers have come out quite frequently to say that they too are night owls or suffer from insomnia and in order to still operate under the disguise, for lack of a better word, of being awake during normal business hours, they simply schedule their blog posts that they have written in advance, to publish throughout the day. I could do this if my WordPress did not consistently refuse to publish scheduled posts, therefore making me believe that my installation of WordPress has developed some sort of technological personality and I am just not ready for my content management system to start taking over my life, and then of course, the world.

Just a few days ago I had stayed up all night and got so, completely tired, but wanted to force myself to stay up all day and “work,” also known as write blog posts which is very much work in my life, this website technically being my business regardless of how much I enjoy doing it, but something dawned on me–something that should have dawned on me quite a while ago. I created Woman Tribune in order to provide information to women and to explore and open discussion about the topics that interest me, and collectively other women around the world. If I stay up all night and sleep all day, yet still provide this same service, then I have essentially fulfilled my obligation. If Woman Tribune has become even the least bit important, or a daily stop on women’s blog hopping and internet stays throughout the day, then it technically should not matter when new posts hit the home page.

When small potatoes bloggers, and yes I do very much consider myself small potatoes, I do not have an ego in the least when it comes to my “online personality,” see the blogs of corporations or really, really big potatoes bloggers updating several times a day it is because most of them have a staff of writers. Most of them have pre-written posts to publish throughout the day to make themselves look more professional, again for lack of a better word, than they really are. Bloggers who have created their own websites and who are the sole bloggers on their websites cannot catch up to the amount of volume being presented on professional and corporate-backed blogs and it is about time that we stop trying to. We don’t have teams or staff, we just have ourselves and if people are still logging onto our websites, then it must be enough and it must be okay.

Do you keep to a blogging schedule? Do you think having a blogging schedule or posting at the same time every day is important?

While I and Woman Tribune, essentially is a “small potatoes” blog, I am very interested in its continued expansion and if any women out there are interested in contributing guest posts or weekly/daily columns to Woman Tribune, please feel free to contact me directly at holly[at]womantribune[dot]com to contribute your awesome blogging talents. I’m sure we could work something out and you would be in pretty good company because for the most part, I kick ass. Again, just sayin’…

Transferring a Credit Card Balance–A Good Idea?

This is a guest post by Bill Hardekopf, CEO of LowCards.com.

Balance transfers have been popular among credit cardholders for a number of years. More consumers are now considering a balance transfer due to the rising interest rates on their existing cards. But is this a good idea?

If you have good credit and your credit card APR is currently above 20%, this is the time to consider transferring your balance to a card with a lower rate. As we saw in 2009, balance transfer fees are increasing and the introductory periods on these offers are decreasing. This trend is likely to continue in 2010.

“Balance transfers are a good illustration of the changes in the credit card industry. Issuers once used balance transfer offers to lure cardholders from other issues; they were eager to accept any application because any growth was good. The loans were cheap and easy with 0% for at least twelve months and no balance transfer fee. These loans were so easy to get that some cardholders transferred their balance from card to card at the end of each introductory period, never paying interest on their credit card debt,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook. “Several years ago, issuers added a 3% balance transfer fee, with a $50 or $75 cap. Then the cap was dropped. 3% was the standard fee until some issuers began raising it last year in an attempt to increase revenues in any way they could.”

Here are the current balance transfer fees by issuer:

• Chase: 5%
• Discover: 5%
• Bank of America: 4%
• Citi: 3%
• American Express: 3%
• Capital One: Most do not have balance transfer fees, but the Platinum Prestige card charges 3%

“The CARD Act does not restrict balance transfer fees. It would not be surprising to see further increases in the balance transfer fees this year,” says Hardekopf.

Issuers learned a lesson from the lending meltdown that helped bring the record-setting defaults that are still dragging down credit card revenue. Today, credit card default rates exceeded 10% for some issuers. This makes issuers even more sensitive to risk and they are taking strong measures to avoid it. They have sliced credit limits and limited the terms of balance transfer offers to reduce risk. In the eyes of the issuer, cardholders who need a balance transfer the most are likely in a higher risk category and could have a greater probability of default.

Who Should Apply for a Balance Transfer Card?

Start with your credit score because issuers will use this to determine your credit limit, interest rate, and length of the introductory period. If you have excellent credit (a FICO score of 740) and your APR is over 15%, you should consider transferring your balance to a card with a lower interest rate.

If your credit card rates are high because your credit score is low, it is unlikely that you will receive the offer that you need, so you must have realistic expectations. You will not receive the lowest advertised rate and your introductory period may only be three to six months. Your credit limit may be less than the amount that you requested and you may not be able to transfer your total balance. Use the average limit of your other cards to estimate the credit limit for a new card. Balance transfers may be limited to a portion of your credit limit.

“Before a consumer transfers a balance from one card to another, one should do the math to see if the amount of interest payments that you save via the introductory offer outweights the balance transfer fee that has to be paid immediately. Be sure to factor in the ongoing APR if you are not able to pay off the entire balance during the introductory period,” says Hardekopf.

If the offer you receive does not meet your needs, decline the card. Limit the number of applications because multiple credit applications are a red flag on your credit report and can lower your credit score.

Which Card Should You Apply For?

The length of time it will take to pay down your debt should determine the cards you compare for balance transfers. If it will take you more than a year to pay off your balance, look for a card with an ongoing low interest rate because a low APR for the long-term is likely to be more important than the length of the introductory period.

If you can pay off your balance in less than a year, apply for a card with 0% for 12 months for balance transfers. With a 0% loan, you will pay off your balance much faster if your total payment is applied to the balance. You will also save yourself money in interest payments.

The best cards for balance transfers are the ones that offer an introductory period of twelve months for balance transfers and a low ongoing APR. Pay attention to what transactions are included in the introductory offer. Some offer 0% for 12 months on purchases, but not balance transfers; similarly, other cards may not include the 0% on any purchases.

Avoid cards with high interest rates, even if they offer generous rewards. Since you carry a balance, paying off your debt as fast as you can at the lowest interest rate is the only factor you should use to compare credit cards. Most credit card issuers do not give you points for balance transfers.

The Fine Print

• You must pay on time, every time. If you have a late payment, your introductory period will likely end and you will be assessed the APR on the transferred balance.

• There is no grace period with balance transfers. Interest charges begin at the time the check is issued to your credit card institution.

• You can’t transfer your balance to another card with the same issuer.

• It takes about four weeks for the balance to be transferred. Continue to make all required payments until you confirm that the balance transfers were made. Multiple balance transfers will process inthe order they are requested on the application.

• The new issuer pays the amount of the balance directly to the old issuer and the amount you owe them will be reduced by the amount you transferred. The available credit on your new account will be reduced, as if you had made a purchase.

• Transferring a balance does not automatically close your old account. If you want to close the account, contact the issuer directly.

• Issuers have the right to decline balance transfer requests or transfer less than you requested.

“After you transfer a balance, stop using the old card. If you use both cards for spending, you could soon have large balances on both cards and get yourself deeper in debt that you were before,” says Hardekopf.

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LowCards.com simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1260 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for eight years.

Using Credit Card Rewards Points to Donate to Haiti Relief Efforts

It was announced in mid-January that the nation’s largest credit card networks–Visa, Mastercard, American Express and Discover, would waive fees for some contributions that were being made to aid Haiti relief efforts, after taking a heap of criticism for charging up to 3% of charitable donations for transaction fees. This is only the second time that credit card companies have waived fees made from charitable contributions, which companies rake in as much as $250 million dollars annually from; the first time they waived these fees was after the tsunami in 2004.

Now that the major credit card companies have waived their (in my humble opinion, devastating and ill-willed) fees aimed at charitable contributions, many companies have also set up processes in which cardholders can redeem their rewards points to make donations to aid Haiti relief efforts.

• American Express has set up a website, GivingExpress Online, which lists a number of great charities and allows cardholders already enrolled in their Membership Rewards program to donate to any of the charities listed on the website by using their Membership Rewards points. American Express has also announced a donation of $250,000 to assist several different charities dedicated to the relief efforts in Haiti, including the American Red Cross, Doctors Without Borders, International Rescue Committee and the United Nations’ Friends of the World Food Program. They are also matching employee donations for relief efforts.

• Capital One launched their No Hassle Giving Site in 2008. This website allows cardholders to donate rewards to more than 1.2 million United States charities. Since the devastating earthquake hit Haiti in early January, the No Hassle Giving Site has listed about a handful of worthwhile charities dedicated to Haitian relief efforts. Cardholders have the option to set up charitable donations online as either a one-time only donation or a reoccuring donation; cardholders will also earn rewards on their donation transaction. A Capital One spokeswoman has also declared that donations made to the relief efforts in Haiti are tax deductible and donors could obtain a detailed donation history and summary of taxable donations for their records.

• Chase cardholders who hold either Chase Freedom, Sapphire and/or Ink can redeem and donate their Ultimate Rewards points to the American Red Cross Haiti Relief and Development Fund. Donations can be made starting at $25 for 2,500 points and then in $25 increments beyond that. There is no limit to the amount of points you can redeem to donate to Haiti, as long as it is up to your points balance.

• Citibank has enabled cardholders to redeem their ThankYou Network loyalty points to make donations to the American Red Cross and the ARC Disaster Relief Fund before the earthquake hit Haiti. Since the earthquake, donations have been reported to increase to 20 times the normal number they will pulling in. On January 20th Citibank added a Haiti-specific donation option which benefits the American Red Cross International Response Fund and since then, there has been a nearly 100 times increase in the daily redemption rate of loyalty points. You may redeem your ThankYou Network loyalty points in denominations of $50 and $100 to benefit the American Red Cross International Response Fund. You can also call the ThankYou Network service center to redeem your points for a donation by calling 800-842-6596.

Woman Tribune has been reporting on the relief efforts, current conditions, ways to donate and how people around the world are uniting to help Haiti in a time of serious and desperate need. We will continue reporting as information becomes available, so please consider following our reporting on Haiti to stay up to date on what is happening there.

CARD Act–Major Provisions Less Than One Month Away

This is a guest post by Bill Hardekopf, CEO of LowCards.com.

The major provisions of the CARD Act take effect on February 22, less than one month away.

“The CARD Act made some very beneficial changes for credit cardholders. Consumers have been wanting these strong protections for years and they will become real in one month,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook. “However, the industry landscape has changed dramatically since May when the CARD Act was finally signed. Issuers have reacted to a very rough economy and this new law by finding new ways to increase their revenue. They have raised interest rates, closed accounts, increased fees and decreased reward programs. It is likely that the number of people who have been negatively affected by these new changes outnumber the people that significantly benefitted from the CARD Act.”

Here are the major provisions of the CARD Act that go into effect on February 22:

• There will be new rules for interest rates. Issuers cannot increase rates during the first 12 months of a new account. On existing accounts, if your rate is increased, the new APR only applies to your new purchases; your existing balance is still charged the old interest rate. (There are some exceptions on both of these provisions: if the card has a variable rate and the index goes up; if the introductory period ends and the rate increases to the standard rate; the payment is more than 60 days late; payments fall behind in the debt management plan.) Any monthly payments above the minimum amount must be applied to the balance with the highest APR first.

• There will be protections for underage consumers. If you are under 21, you will have to prove that you are able to make payments, or you will need a cosigner, in order to open a credit card account. Issuers are also prohibited from offering free gifts to these young adults as inducements for signing up for a credit card.

• Over-the-limit fees are banned unless consumers give issuers permission to allow the transactions that put you over your credit limit. If consumers do not “opt in,” then issuers cannot charge you this fee and your transaction may not go through.

• Your statement must clearly explain how long it will take to pay your balance if you only make minimum payments. It must also teel you how much you need to pay each month in order to eliminate your balance in three years.

  “This is one of the best provisions of the bill. It is too easy to pay your minimum amount without calculating how much more you need to pay to get out of this debt. Now the reality of how much you are paying in interest will be clearly stated. Hopefully, this will be an incentive for cardholders to pay more of their balance each month,” says Hardekopf.

• There will be caps on high-fee cards. If your credit card company requires you to pay fees (such as an annual fee, processing fee or application fee,) those fees cannot total more than 25% of the initial credit limit. This limit does not apply to penalty fees such as penalties for late payments.

• There will be changes and standardizations for billing and payments. Your due date should be the same date each month and the payment cut-off time much be 5pm or later on the due date. If your due date is on a weekend or holiday when the company does not process payments, you will have until the following business day to pay.

• Two-cycle billing will be eliminated. Credit card companies can only impose interest charges on balances in the current billing cycle.

• Universal default is now prohibited. Issuers can no longer increase a cardholder’s APR based on their payment records with unrelated accounts, like a utility bill.

In addition to these provisions, there are several rules that went into effect on August 22, 2009:

• Your issuer must send your credit card bill at least 21 days (rather than 14 days) before your payment is due.

• Your credit card company must give you 45 days notice (rather than 15 days) when they plan to increase your interest rate or certain fees (annual fee, advance fee, late fee.)

• If an issuer increases your interest rate, you have the right to “opt out” of that increase. You can no longer make any new purchases with that card, but you can continue to pay off your balance at the existing (lower) interest rate for up to five years.

“We have lived with the politics and consequences of this bill for almost two years. It will be interesting to see if these new provisions are helpful for consumers or if the higher rates and fees are the only lasting changes from the CARD Act,” says Hardekopf.

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LowCards.com simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1260 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for eight years.

Paying Down Personal Debt

This is a guest post by Bill Hardekopf, CEO of LowCards.com.

One positive sign from the economic downturn of the past year is that consumers finally began paying down their credit card debt.

In November, Equifax reported that credit card debt had declined 7.3% from a year ago. The latest Federal Reserve Consumer Credit report revealed that credit card debt fell in November for the 14th consecutive month. Revolving credit, the majority of which is credit card debt, has fallen over $100 billion since October of 2008, from $976.1 billion to $874.0 billion.

A number of factors could be contributing to this trend. Millions of consumers have lost their jobs or experienced a significant decline in their income. But there also seems to be widespread consumer outrage with the changes made by credit card issuers. 2009 was a year full of interest rate increases, credit limit decreases, and tightened credit by issuers. These were strong incentives for cardholders to cut back on their credit card usage and pay down their balance.

“Issuers began making these changes in 2008 and we expect them to continue in 2010. Even though the CARD Act will help stabilize some rate increases, many cardholders are already stuck with very high rates,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook. “The only way to protect yourself against these high rates is to pay off your balance.”

Here are some consumer tips to reducing your personal debt in 2010:

• Accept that paying off debt won’t be easy. It took you a while to get into debt, and it will probably take you longer to get out. Do not get discouraged, no matter how much you can pay off or how long it takes.

• Start with researching how much you really owe. If you only pay the minimum balance, it is easy to focus on that number and lose track of the total balance. Collect each of your bills with outstanding debts including all credit cards, mortgage, student loans, auto loans, personal loans, and bank loans. Create a summary sheet that lists the creditor, monthly payment, balance, interest rate, and credit limit for each. List the status of each account, if any bills are past due, and verify the payment due dates.

• This debt summary may be overwhelming, so prioritize which bills to pay first. If money is short and you can’t pay all of your monthly bills, first pay the bills that are a necessity for health, shelter, basic groceries, and basic transportation. Then pay the secured loans such as your car loan. Payments on unsecured loans, such as most credit cards, should come last in these critical situations.

• Contact your creditors to negotiate lower rates. The less money you pay in interest, the more money you have to pay off your bills. You may also want to shop around for a mortgage or credit card with a lower rate.

  If you are in danger of missing a payment, contact your credits as soon as you realize you have a problem. They may be able to help you work out a payment plan, lower your rate, or lower your monthly payment. Credit card loan defaults are 10% or more for some issuers.

  If the first person you speak with can’t help lower your rate or make adjustments to your account, politely ask to speak with a supervisor or someone who can. Persistence may be necessary to find the person who can or will help you. Explain that you are in debt, the steps you are taking to repay it, and what you can pay today. Document all conversations, including whom you spoke with, and the date, time, and the results. If this doesn’t work, contact the National Foundation for Credit Counseling to work out a debt management plan.

• If you have multiple credit cards with outstanding balances, focus on paying off the card with the highest interest rate first. Continue to pay the minimum on your other cards until the card with the highest rate is paid off, then focus your effort on the card next in line. Don’t close all cards that you pay off. Keep your oldest cards open and occasionally use them to buy a magazine or a movie ticket–just pay it off each month. This will help improve your credit score.

• Pay more than your minimum payment. Your minimum payment is usually only 2%-5% of your balance. At this rate, it will take you many years to pay off your debt. Pick your card to pay off and try to double the minimum payment. Soon your credit card bill will include these calculations.

• Check into transferring your balance to a lower rate card. If your rate is above 15%, it could pay off to transfer the balance for that card to one that offers 0% for 12 months for balance transfers. However, this is not the “no interest for a year” loan it used to be. Issuers have tightened their balance transfer offers and you will have to search to find an issuer that offers 0% for 12 months. Citi Platinum Select currently offers 0% for up to 12 months. Most balance transfer offers have been reduced to six month.

  To take full advantage of this 0% interest, pay as much as you can above the monthly minimum. Be aware that credit limits are shrinking and you may receive a smaller credit limit for your balance transfer. Only use this card for the balance transfer, not additional purchases.

  Pay attention to the balance transfer fee. At the beginning of 2009, the industry standard for a balance transfer fee was 3%. But some issuers increased that fee during the year. In June, Bank of America increased the balance transfer fee to 4% and Discover now charges 5%.

• If you have a credit card balance, stop using it for anything other than necessities. Use cash instead. Credit cards are convenient, but if you carry a balance, you are still paying interest for dinners, clothes, entertainment and things that are long gone. If your APR is 15%, ask yourself if the purchase is worth paying an additional 15%, ask yourself if the purchase is worth paying an additional 15% in interest per year. If you use cash, you will not only save money on interest, but also reduce the amount you spend. According to a Dun & Bradstreet report, shoppers spend 12% to 18% less when using cash.

• Pay your bills on time, every time. Late payments can cause declines in your credit score. If you are 30 days late on your credit card paument, you could lose 60 to 110 points, depending on your credit score. The higher your credit score, the more points you will lose.

• If you are surprised by your current rates, check your credit report. It may contain an error that is creating a lower credit score and higher interest rates for you. If you find an eror on your credit report, contact the credit bureau to report it. They must respond to your claim in thirty days or remove the information that is incorrect or can’t be verified. You can make your dispute by mail, telephone, or online. If the corrected error results in a higher credit score, contact your creditors to make sure they know about your improved score, and ask for a lower interest.

• The good news. If you build a history of paying your bills on time every time, and start paying down your debt, not only will your debt decrease, but your credit score will increase. As your credit score increases, contact your issuers to ask for lower rates.

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LowCards.com simplifies the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card. The LowCards.com Complete Credit Card Index is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1260 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for eight years.

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