Sadly, we don’t see contradictions in our views on credit. Earlier sub-prime debacle resulted from financial institutions’ seeking out, and then lending funds to people with bad credit! Lately, have you listened to advertising for vehicles, furniture, appliances, and other consumer items? To retain or grow sales, merchants offer credit to almost anybody! Christian ministries, too, have entered the fray: they encourage donors to give on credit, irrespective of ability to pay!

New Credit Card Regulations

Introduced in the USA in 2009, and Canada in September 2010, they require greater card issuers’ transparency to protect card users. Canadian regulations mandate an effective minimum 21-day interest-free grace period for customers paying full balance. But my favorite rule that applies in both countries require credit card statements to show repayment period if consumers paid monthly minimum payments only. This will shock some users who will learn that their monthly payments amounts to a life, debt-sentence!

Prudent Credit Card Use

Will regulations help? Probably not. Card users need behavior change to use credit cards wisely: a return to old-fashioned save-then-buy. Prudent card use pays full balances monthly; misguided, expensive use carries monthly balances. Perhaps a first step to stop using credit for consumer items might be a prepaid credit card. Banks offer them, loaded with funds–essentially they are cash cards–no credit checks needed because the card must be backed by cash equivalent to each buy. If folks want to take advantage of the minimum 21 days credit (in Canada), the next step is to turn the credit card into a check. Here is an approach:

1. Get a low limit card, say, $500
2. Open a bank account, deposit $500
3. Arrange with your bank to pay from that account on due dates, full monthly card balance
4. Monthly, top up your bank account with the amount the bank withdraws to pay the previous month’s charges

In month one, if you charged $300, which the bank paid from your account early month two, leaving $200, deposit $300 to restore the balance to $500. Repeat the cycle. Linking your credit card to a bank account from which the bank pays the full monthly balance was standard practice in Japan when I lived there in the mid-90′s. Today in Canada, if requested, most banks will agree to this procedure, but they are unlikely to offer it.

Beware; unless you distinguish the two parts to each spending decision–establishing the need, and then deciding how to pay for the item–merchant’s seductive financing offers will trap you. As well, unless you work with a budget, or spending plan, you will spend more than if you used cash–estimates range up to 30% more! If you don’t plan buys, and you don’t to pay the full monthly balance, you can’t afford a credit card; use cash or a prepaid card. Do you know how much interest on credit card debt you paid last year? This year to date?

In our previous travels whenever we needed additional cash we just went to any bank and got a cash advance on a credit card. The bank teller would call wherever to get the authorization and we would get our advance in about half an hour. This time when we went to replace the money spent on the repairs and dental work the teller called for authorization and was told the advance could not be granted. The reason given was because we had not informed the credit card issuer before leaving the United States that we would be using the card outside the country. This requirement was news to us as we have been obtaining advances when needed without problems for over twenty years.

We went to another local bank with a credit card issued by a different company and requested a smaller amount. Same negative result. Both cards were of the same brand. In order to solve this cash flow problem I had someone at home in California send us some money via a well-known international Western transfer agent. We use that service on a regular basis and have never had a problem.

I wrote to several business associates, friends and family members who travel about this experience so they could be forewarned. A friend wrote back saying she had this same credit card advance problem in San Jose, Costa Rica. The only way she could get any emergency money was from a teller machine at the airport there. One of my daughters told me this happened to her while she was travelling in another state. She called her bank and was told that whenever people request a cash advance from a location outside their “local area” there is an assumption that the credit card is stolen. Once the bank representative confirmed my daughter’s identity he made a notation in her file of where and when she would be travelling and she received her money.

When I returned to California I inquired about this new policy because it doesn’t make a whole lot of sense to me. First of all, I dislike disclosing personal information about when and where I’ll be away from home for extended periods of time. How secure is that knowledge? Secondly, if the bank knows I’m travelling but my credit card gets stolen somewhere along the way, would the bank approve any transactions anyway because my travel plans are on file? Besides, what bank would give a cash advance to someone without a photo ID such as a passport or driver’s license? Despite these concerns the representative I spoke with reaffirmed the bank’s policy. Her only suggestion was that I write down the phone numbers shown on the back of the credit card so I have them in case the card is lost or stolen. That wasn’t the situation but it sounds like good advice anyway.

I will likely change cards to banks that have offices in California and in cities that I will be visiting. Hopefully by being a customer I’ll have fewer hassles than trying to deal with local foreign banks with which I have no relationship. Citi Bank and HSBC Bank seem to have branches in most countries or at least the ones we visit.

So the lesson learned is this – before you leave town with your credit cards contact the issuer, usually a bank rather than the sponsoring company. (In our case one of the cards was obtained through an airline’s application but a bank is the lender.) Ask about the bank’s policies regarding credit card use for cash advances when out of your “local area”. You then decide whether to disclose your itinerary.

While nothing is more exciting than getting your first college student card, there are certain things that are needed to be taken into consideration before you sign up for one. The reality is that, many young adults are not aware how to use student credit cards responsibly. If you are not careful, these cards can hurt you financially.

Another important thing to consider is that students must have proper direction where these cards must be used. In this article, we will discuss the perfect ways to their college student credit card:

Educational Fees

While a large majority of students got their university fees covered by educational plans or loans, there are certain fees that are not covered by such plans like books, and added items that will be incurred while attending college. Unfortunately, most of these items are available only from the college they are in so they have no choice but to buy them exclusively to their respective schools. Using student cards for such items is the best option.

Transportation

Although most students have their own cars or they can use public transportation to travel back and forth, paying these transportation charges using their own student credit cards is a very convenient option. Any types of repairs and maintenance can also be covered using cards.

Everyday Expenses

Major household bills as well as additional expenses like clothing, food, toiletries, etc. can be paid using cards. However, make sure that you are only buying items that are necessary otherwise; you might be sucked into the nasty habit of buying things you cannot really afford.

Medical Needs

If you do not have any medical insurance then you can charge your medical expenses on your card. This will come in handy especially in emergency situations. These charges then are submitted later to insurance carriers to reimburse the fees.

What does this mean to you, the merchant? Well, with more debit cards coming into use, you will see an increase in the number of your own customers that will present a debit card for payment at the register, versus a credit card.

In today’s economy many people have maxed out their credit cards or have damaged their credit and can’t qualify for an actual credit card. Then there is the growing sector known as “The Unbanked”, individuals who are not in the banking system, either by choice or due to credit problems. These people often carry pre-paid debit cards purchased at check cashing stores, etc. They load cash onto the cards and use them just like any bank-issued debit card. The cards carry either the Visa or Mastercard hologram.

Debit cardholders may elect to have you swipe their card as either debit, requiring the customer to enter their Personal Identification Number (PIN), or have you swipe their card as “credit”.

Most merchant normally actually ask the customer, “Debit or credit?” This is not the way to save yourself money on transaction processing costs. As most merchants know, the cost is much less to process a transaction as debit than credit. Debit transactions do not run through the Visa or Mastercard interchange network, and thus bypass their fees. A typical credit card transaction might cost a merchant 1.6% and 20 cents transaction fee. To process that same transaction as a debit, the cost is typically 0.7% and 30 cents. The difference will average roughly $100 savings per $10,000 in sales. ( In this example, 1.6% would represent a transaction at the lowest tier, known as Qualified. If the card has rewards, such as cash back or airline miles, it would run as Mid-qualified at around 2.7% or more. A business or corporate or foreign card at 4% or more.)

So why would you leave the choice of processing to the customer? They don’t care, trust me. What you should be doing every time you take a debit card is swiping it as debit and presenting the PIN keypad to the customer so they can enter their PIN. If you ever get a customer who for some odd reason really prefers to run the transaction as credit, just hit your cancel button and re-swipe as credit. Some pre-paid debit cards do carry a transaction fee to the cardholder for credit swipe transactions and I have met people who incorrectly believed their bank would charge them a fee for a PIN debit transaction.

Being proactive like this can save you thousands of dollars a year, and with debit card use on the rise, processing debit cards properly will become ever more critical.

What’s that you say? You don’t have a PIN keypad? Well, contact your account executive with your merchant processor and order one today. They cost anywhere from $100 to $300 and are often available refurbished.

Many credit card terminals actually have a PIN pad function built in, the customer enters their PIN directly on your terminal keyboard. Check if your terminal does this.

One final remark about the savings by processing a debit card as debit versus credit. Depending upon what your merchant services provider (MSP) is charging you for debit card PIN-based transaction versus credit card, there is a price point below which you may save money by choosing to swipe a debit card as a credit card. Example: You sell ice cream cones. Average sale ticket is $10 for a family’s purchase. To process as a PIN-based debit, the cost to you will be .70% plus 30 cents. That comes out to 7 cents and 30 cents= 37 cents to process as debit. As a credit sale it would be 1.6% and perhaps 15 cents so that comes out to 16 cents plus 15 cents = 31 cents. 6 cents lower that a PIN-based debit sale. Not a big difference for one sale, but multiplied out to a month’s sales volume it amounts to a bit of money you might be wasting. You will have to run your own numbers depending on your own processing costs.

What’s that you say? You don’t know exactly what you are paying to process plastic? Well, you need to find out!

My own company, the merchant services provider for whom I am an account executive, offers a free analysis of your recent merchant account statement. We break down what you pay for all three tiers of credit cards (known as Qualified, Mid-qualified and Non-qualified) as well as the various monthly fees that may be tacked on, and we the, side by side, show you what we propose to charge and what your bottom-line savings could be by switching your merchant processing to us. All in one neat and easy-to-read page. Free. I have looked at many merchant account monthly statements in my time and most can be very confusing to the customer.

We are entering a cashless era in society and the ability to take electronic payments – credit and debit cards, gift and loyalty cards, electronic check processing and more – is a crucial aspect of running your business, and managing the associated costs is just good business.

No financial institution in their procedures manual, would give anyone “carte blanche” (meaning open-ended) credit with a non-restricted credit card. Even the gold cards have their limitations.

Your debt ceiling is reached only on that particular avenue of credit. It doesn’t mean that every other avenue of credit is reached so if you find your allowed debt ceiling has been reached on one credit card, if you were in desperate times and needed more credit and you had a good credit history, you would still be able to access more credit from other financial institutions.

However, if you have reached your debt ceiling on one credit card and have missed one or two repayments, you may find it difficult or near impossible today to get more credit from another financial institutions or credit card providers because today, everything related to your credit viability is linked into a central banking system.

This is a great protection for banks and other financial credit providers but can be devastating for anyone who suddenly finds themselves in urgent need of more money.

Credit is a system of providing money to people at a price.

Credit is money and is now a product that has become essential in today’s way of life. Credit money is a product tool that can be used in many ways. It is up to each of us as to how we use it. If we all approached the use of credit as we would if we had a spade and wanted to dig a hole in the ground, then we all need to ask ourselves, “How many spades do I need to dig this hole?”

Most people today have got themselves into financial difficulty because we have used our credit limits unwisely. That is, many of us are either:

1. Under paid – our employment is paying too little or we aren’t getting enough hours of employment
2. Under employed – We don’t have enough work to cover our living expenses so instead of living more simply; we have used our credit cards to top-up our cost of lifestyle.
3. Lifestyle expectations too high – We are all trying to live up to a consumer lifestyle without the monetary means to support that style of living.

Money is just a tool and should be used as such.

If you use your available credit only as a tool with which to make money, then credit money can be a good thing providing you don’t exceed your debt ceiling and you continue to meet all your repayment responsibilities.

Some guaranteed credit cards demand that men and women pay a set of expenses as a way to acquire a credit card. The institutions present these cards only if the consumer agrees to these conditions for obtaining a guaranteed credit card. These ailments for the guaranteed card are defined when the card is issued. The phrases and problems for these cards might be rather extensive and at times confusing to people who do not comprehend many legal or banking phrases. These terms and problems may cover late payment costs, application expenses and many other expenses.

Some guaranteed cards are set up so the client deposits a specific volume of money in to the card account. Depending on the company, this deposit is usually made by transferring funds on the net or by visiting the branches in the corporation. This consumer can then use this these cards for their purchases. The guaranteed card can have a small amount of money or thousands of dollars. Some people today will probably be in a position to have their paycheck go to this guaranteed card, or they are able to deposit money into this card account as needed. Some individuals can have their mother deposit money in these accounts if they can’t do it.

Guaranteed credit cards produce a wonderful service to the consumers. These cards may be applied at any time with the day or night, and they could be applied on website at many millions of merchants who accept these cards. Credit cards are fantastic tools that are beneficial in Tahiti or Timbuktu. These guaranteed cards can be employed to spend for a hotel bill or spend to get treatment from a dentist. Most people today will come across that these cards will make nearly all transactions and life in general less difficult.

Using Your E-Reader

The Amazon Kindle has evolved over time into the Amazon Kindle 3. Review the features of the device first to determine which device is right for you. The Kindle 3 is one of the most expensive options available from Amazon, with a price of $189. This is still one of the most affordable readers on the market, however, since some models can cost well over $200 and offer fewer features than the Kindle 3. Comparing brand names is a good way to decide which device is right for you, as well.

The Amazon Kindle 3 offers readers an improved display with an anti-glare screen for easy reading that doesn’t strain the eyes, while the battery life has been extended over the previous versions of the Kindle. The device is also lighter and more portable than other options available, providing you with a simple option for on the go reading. If you want the most advanced, easiest to use and most portable Amazon Kindle, the Kindle 3 is your best bet. Since the Kindle is also affordable, you can easily have more than one available for your family.

What to Know

When choosing a new e-reader, you will want to begin by looking at the cons of the Amazon Kindle 3. Review the memory size when compared to other readers and note whether or not it is suitable for your personal needs. Some users don’t like that there is no option for external memory sticks, while others find that the ability to hold over three thousand books is ample space for a small library. Even the most avid readers will find that 3,500 books is more than enough to keep them occupied for some time to come.

The Amazon Kindle 3 is also interactive, allowing you to take notes on the screen as needed. The note taking ability is a nice feature for anyone who wants to remember things that they have read, or who need to bookmark a page for future use. Since you can download both books and magazines on the Kindle 3, it is easy to find something that you will enjoy reading through the Amazon website. The Kindle 3 also supports a wide range of file formats, ensuring you can easily read any file that you download.

Buying Your Kindle

To buy and download books onto your Kindle 3, you will need an Amazon account that stores your credit card information. Amazon does offer thousands of free ebooks, as well, so you may not ever need to use the credit card.

For many small business owners, credit cards are a vital source of funds when an emergency, or an immediate business need arises. Many small businesses are started with a modest cash investment. As businesses grow, they often must make purchases of products for resale, supplies for business use, or travel for business needs. The ability to make some of these purchases with an affordable credit card solution is a huge advantage to a small business. Small businesses often look to leverage great ideas or products early and then cover the costs of doing so as business picks up over time.

There are many unique opportunities and advantages that come with small business credit card offers. One significant difference between consumer credit cards and business credit cards is that most card companies allow small businesses to have multiple cards linked to the same account. This enables a company to provide several people within the company access to the credit line as needed. This is much more feasible than attempting to pass one card around for use by multiple business parties. Business owners can also place limits and track spending with small business cards. This allows owners to budget and managed spending when multiple cards are in use.

Another benefit of small business credit cards is that rewards and discount programs are often more valued than they are by consumers. Because small businesses often make more and larger purchases, they typically reach worthwhile reward milestones sooner than individual consumers. This is a great advantage for small businesses that use rewards or cash back incentives to fund other purchases for business use. Some card companies also offer discount purchase programs to small businesses by establishing a partner network of companies that agree to provide the discounts. Ultimately, a small business credit card is a necessity for most small businesses. The cards offer a more efficient, convenient, and beneficial source of financing than most other types of credit and loans often used by small businesses.

Perhaps I should tell you the story of my first home purchase. I purchased my first piece of real estate in Chicago during the late 1970s. At the time, the city was in the midst of a relatively new real estate phenomenon. Real estate developers and investors were feverishly purchasing large and mid-size apartment buildings, renovating them and converting them to condominiums. I had recently arrived in Chicago from college to start my first job. Arriving at the beginning of this condominium craze, I was immediately attracted to what appeared to be an excellent ground-floor opportunity. Houses in the Chicago area were well beyond my means, but the cheaper two-bedroom condos were within reach.

While I was otherwise qualified to purchase a very nice condominium in a turn-around Chicago neighborhood, what I did not have was money for a down-payment. I stayed awake at night trying to envision a way to pull together what was needed. An older buddy at work told me the story of how he purchased his first house using credit cards. This information was just what I needed to put together my first down payment. I used my only credit card and one that my parents had to put my plan into action.

The plan worked well for me because: my credit was very good at the time and drawing down the maximum under my card did not dissuade the mortgage lender; I had full access to my card and was able to tap my parents’ card; I had a stable job and earned enough to service the credit card debt, the mortgage loan, and still be able to repay my parents within a year; and lastly, I am a bit of a risk taker, and fortunately the risk paid off.

Using credit cards as a tool to help finance real estate can be useful. Credit cards are convenient, versatile forms of financing. Usually, you can borrow and re-borrow up to the cash advance limit as needed. Finally, you have already been approved to use them.

There are, however, some big negatives.

The repayment requirements are fairly stiff. Most credit cards require repayment of the outstanding balance within as little as 42 months. This short time frame may not fit your cash flow circumstances.

Another negative is that high card balances will negatively impact your credit rating. If you have great credit and you can afford the credit card payments, it might be worth taking this risk to buy good real estate.

Using credit cards and other consumer credit can be addictive. If you have little self-discipline in this area, it is probably best not to use your cards for real estate. You might be better served by ridding yourself of credit cards altogether.

Lastly, the interest rates charged by the credit card companies are relatively high. Rates can range from 12% to well over 18% per year. These high rates will eat into your real estate gains.

Given the advantages and disadvantages, do credit cards make a good choice for financing real estate investments? This method certainly is not an ideal one because of its high risk. It would not be my first choice. I would tap other assets like life insurance cash value or money from a 401-K plan ahead of using credit card debt.

I would only recommend this financing method as a short-term arrangement, if you have run out of other alternatives. Additionally, it probably makes little sense unless: you have a stable job; you can afford to service the credit card debt; you can afford the real estate mortgage and can manage the related real estate expenses; and you will still have money left over to live fairly comfortably.

Increase Your Customer Base

Customers like credit cards for a number of reasons. Especially in recent years, more and more men and women have turned to credit cards to make a wide range of purchases.

While once these cards were reserved primarily for large, expensive purchases, today’s consumers use them for even small daily purchases, like a cup of coffee from the local coffeehouse, and everyday expenses such as groceries and gasoline.

With so many consumers reaching for plastic when it’s time to make any type of purchase, using credit cards ahs become second nature. Appealing to this large group of consumers can go a long way toward helping you grow a big, healthy customer base. The reasons why customers are using cards more and more are varied.

Here are a few:

Flexibility

One of the major advantages of these cards for consumers today is that they allow a buyer to spread out payments over a period of time. As a result, buyers can afford to make larger, more expensive purchases than they could with cash.

Buyers appreciate the ability to choose whether to pay the minimum amount due, or to pay the balance in full, based on their budget for any given month. And, as the card balance is paid down, consumers know they will have a replenished amount of cash on hand to use as needed, for both unexpected and planned purchases.

Convenience

Credit cards are less bulky to carry than cash, and they are les restrictive than cash, eliminating the need to carefully preplan shopping trips to ensure they have enough cash on hand to make the purchases they want.

Consumers also know that, with these cards, if they see an item they had not anticipated buying during a shopping trip, they are not limited by a set amount of cash in their wallet or purse, adding an extra level of buying power and freedom.

Credit cards are great for travel and for buying online from international dealers, since they perform currency conversion automatically. Speaking of online purchases, this is where credit cards really shine, with more than 90 percent of online shoppers reporting they only use credit cards to make purchases while surfing.

Security

If a credit card is lost or stolen, card holders can pick up a phone and report the incident, have a new card issued, and avoid paying for nay purchases made once the card is reported. With cash, once it’s lost of stolen, it’s gone for good.

Credit card issuers also offer consumers added security by providing a well established dispute process, which goes a long way toward helping consumers feel safe and secure when making purchases, especially online.

Many cards today also offer extended warranties on products purchased using the card, an especially important consideration with today’s popular electronics products.

Perks

With competition among credit card issuers at an all-time high, many card companies have begun issuing bonuses to card holders who use the cards, a promotion that has proved to be exceptionally popular among consumers today. The more they use their cards, the more bonuses they can earn, including merchandise, hotel stays, cash, and more.

Directly as a result of these programs, the number of credit card users using their cards on a regular basis for all types of purchases has increased dramatically. Bonus for business owners: customers feel great about earning reward when they shop with you – yet those rewards cost you nothing.

Increase Your Profits

Of course, with a larger customer base, your profits are sure to grow. But there are other reasons to expect an increase in your bottom line:

Consumers who use credit cards tend to make more expensive purchases than cash buyers, tend to shop more frequently, and tend to be repeat buyers with a greater degree of loyalty than cash buyers.
Credit card users tend to buy more costly single items, which helps improve inventory turnover.
Credit card users are much more likely to make impulse purchases than cash buyers, and those purchases are of a significantly higher value than those made by cash buyers.

Improve your cash flow

Unlike checks, which can take up to a week to clear, the proceeds from these card sales are deposited into your business account at the end of business each day.