Posted: September 30th, 2010 | Author: Joe | Filed under: Credit, Debt | Tags: Credit Cards, Debt, rewards | No Comments »
Imagine being paid by your credit card company – to pay off your balance!
Hard to believe? Well, yes. Yet that appears to be what’s happening for some lucky credit card holders.
At least four credit card issuers are experimenting with these kinds of reward incentives. It’s not surprising, given that the rate of credit card default has gone from less than 4% in the mid 2000′s to just around 9% in June of this year. Given that stark fact, many issuers may be viewing these types of incentives as a way to settle for at least some of the debt.
These kinds of settlement rewards are being offered to a select few, who are apparently just keeping up with the minimum payments. Credit card companies are not making these offers on a request basis (meaning you can’t simply call up and ask for it). It’s unclear how exactly one gets on this short list though, since it’s unlikely the companies are calling consumers out of the blue. I imagine you still need to make an effort to negotiate the terms of your credit card debt, even if you don’t ask outright for this kind of forgiveness incentive.
Credit card companies say they will be more likely to offer these incentives if they prove successful with this limited initial group. It should be interesting to see how successful these programs are, given that most debt settlement programs don’t work.
For what it’s worth, here are the four credit card companies who have taken steps toward these innovative new incentives:
American Express. Amex has experimented with cash incentives of $300 to some customers for paying off their balances and closing their accounts.
Citibank. Citibank has offered “statement credits” as large as $550 to some customers to pay down credit card debt, accepting credit line reductions and use of their cards for up to 11 months.
Wells Fargo. Wells Fargo has offered reduced interest rates to customers who paid down their balance.
Chase. Chase has offered “statement credits” up to $200 to customers who paid down their debt within six to nine months.
Many of these offers appear to be contingent upon the customer either closing their account, or ceasing to use the card if only temporarily. This may be enough to offset the tendency most people have to simply go back to the behavior that got them into debt to begin with. If that’s true, maybe these incentives will end up being more effective at cleaning bad debt off the books than it at first appears. Time will tell.
source.
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Posted: September 28th, 2010 | Author: Joe | Filed under: spending | Tags: Cell phone service, spending, TracFone | 2 Comments »
Step 3 of getting out of debt is to cut your expenses, and one of the biggest discretionary expenses may be your cell phone service. I know it was one of mine when I had My Financial Tipping Point.
At that time, I was shelling out $80 a month for cell phone service that I wasn’t using. I couldn’t just cancel it either, because that would have incurred a $280 cancellation fee. Needless to say, when that contract expired, I didn’t renew.
It’s been about 6 years since I went with Tracfone, and I haven’t had a single complaint. My wife and I just upgraded our phones to newer models for a total of $28.
One thing about Tracfone is that it’s pay-as-you-go service, which means having to buy more airtime when the tank runs out. Below are a couple of promo codes for would TracFone users, or existing customers looking to add air time.
Here are two TracFone promotional codes just for the month of October to help you save even more money.
30 bonus minutes when adding 120 minutes or more of airtime.
Just like it sounds, if you’re adding 120 minutes or more, you get an additional 30 minutes free when you use the promo code 24285. Valid October, 2010.
50 bonus minutes when adding 200 minutes or more of airtime.
If you’re adding 200 or minutes of airtime to your TracFone, then you get an additional 40 minutes free when you use the promo code 95764. Valid October, 2010.
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Posted: September 22nd, 2010 | Author: Joe | Filed under: Economy, Employment | Tags: Economy, Employment, Recession | 2 Comments »
Can someone please explain this to me?
“The longest recession the country has endured since the Great Depression ended in June 2009, a group that dates the beginning and end of recessions declared Monday.”
According to The National Bureau of Economics (NBER), the recession ended last year, in June 2009. Not only does this ring hollow with near 10% unemployment and no sign of it falling any time soon, but it just doesn’t make sense when you look at the data and match it to the start and end dates given by NBER.
I understand that unemployment is a lagging indicator and it will take a while for it to come back down. I get that. But I also understood a recession as being defined by “2 or more consecutive quarters of negative GDP growth”. In other words, a shrinking economy.
But as this data shows the U.S. economy didn’t have 2 consecutive quarters of negative growth until the second half of 2008 – fully 6 months after the NBER’s claim of December 2007 as the start of the recession!
US GDP 2006-2010
However, if you look at when unemployment began to rise, it was 2007 ( data from the U.S. Bureau of Labor Statistics):
But if we’re using the unemployment rate to determine the start of recession, shouldn’t we use that to determine the end? Or, conversely, if we use GDP to determine the end, shouldn’t that be the metric for the start?
I’m really trying to reconcile this with some sort of impartial logic, but I can’t help but wonder if the reason is really political.
Paragraphs like this one from an AP article make me wonder if the dates and data are being chosen simply to place 2 recessions under one unpopular republican president:
“In President George W. Bush’s eight years in office, the United States fell into two recessions. The first started in March 2001 and ended that November. The second one started in December 2007”
Somebody tell me I’m wrong. Someone explain to me how the recession can impartially and objectively be said to have started in December 2007, and end in July of 2009, because it just doesn’t add up to me.
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Posted: September 20th, 2010 | Author: Joe | Filed under: Saving | Tags: Emergency funds, Guest Post, Saving, Savings, Tips | No Comments »
Editor’s Note: This is a
guest post from
Debbie Dragon..Taking control of your finances begins with having access to an emergency fund. People who have adequate money in an emergency fund aren’t forced to turn to credit cards when an unexpected expense pops up. The typical rule of thumb, or the expert recommended amount to keep in an emergency fund is three to six months of your living expenses.
As you’re building your emergency fund or if you’ve already saved the money, the next thing to consider is where you should keep your emergency fund. It needs to be extremely liquid, meaning you can access it whenever you need it, but in the meantime it should be growing and earning interest so you won’t want to stick it under your mattress or in a hole you dig in the yard!
Here are things to consider when deciding where to keep your emergency fund:
Risk Free – don’t invest your emergency fund in anything that could lose value, like mutual funds or the stock market.
High Interest – since you hope you won’t need to withdraw money from your emergency fund frequently, you want to save the money in an account which will pay you interest for leaving the cash there. Look for the highest interest rate you can get, even a half of a percentage point makes a difference over the long term!
FDIC Insured – if you stash cash under your mattress or somewhere in your home, not only do you lose out on interest earnings, but you’re out of luck if your house burns down or gets robbed. Use an FDIC insured bank to make sure your money is protected.
Accessible – emergencies by nature are normally events which happen unexpectedly. If you have your emergency money tied up in investments which require time to mature before you can access them, it’s not going to do you much good, is it?
Certificate of Deposits
If you have a large amount of money reserved for your emergency fund, you might consider CD laddering, provided there is a CD which matures every month. You don’t want to pay penalties or early withdrawal fees to access your money when you need it.
Another way to use Certificate of Deposit products to help grow your emergency fund is to place part of your savings in CD’s and keep the rest in a more easily accessible savings account.
High Interest Savings Accounts
The majority of people should keep their emergency cash in a high interest savings account. The money is risk free, accessible at a moment’s notice, FDIC insured and will pay you interest for keeping the money in the account.
Take time to compare savings account rates among several banks before choosing. The higher the interest rate you can find, the better! Also consider bank fees, the ability to link your savings account with your checking account, whether or not you want an ATM card for the savings account, and the quality of customer service offered before choosing a bank.
Debbie Dragon is a freelance writer for DepositAccounts.com, where you can compare savings account rates from dozens of banks in one place.
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Imagine being paid by your credit card company – to pay off your balance!
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