IN THIS ISSUE #160
Larissa S. Bilker
Editor: Denise Troy
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Approximately 85% of American households have at
least one rewards card. In its new survey of 83 credit cards, Consumer Action
found that 62 cards offered rewards of one sort or another. Many people make
many everyday purchases using rewards cards. They seek to earn a solid return,
such as 1% or 2% cash back. But rewards cards can have higher interest rates
than regular credit cards; so carrying a balance may quickly outweigh your
reward. Moreover, if you pay late, you may lose the rewards you earned in the
current billing cycle.
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Letter from the Publisher
by Scott Bilker
I hope all is well!
There are more and more scams used to steal
your identity. Here's one that's been around for a while. You get a call
from someone who claims to be from the fraud department of your credit card.
They say your account is flagged and they want to verify information to stop
It's possible that this call is not from your
credit card, but instead from thieves! Crooks after your personal
information! If you get one of these calls, ask for the name of the bank and
tell them you'll call back--then hang up! Take out your credit card and call
the number on the back. You will be safe when you initiate the call!
I saw a great piece on the Today Show
about ID theft. They talked about fake kiosks set up to trick people into
giving up their personal information. Check it out:
Credit Card Scams
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and encouraged because you answered my email directly. I also like
the way that you are so humble and appreciative when people mention
you or your site in their question, and you always make a point to
thank them. Thanks again for getting back to me and your advice!"
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years, I was in credit card debt. A bad auto accident forced me to
change my lifestyle, and, with the help of an honest debt management
program, my debt was eliminated after five years (a wonderful day!).
I'm very careful now, and your informative and practical newsletter
helps keep me on track. Thank you!"
|"Keep up the good work; it is
informative and interesting. It's nice to know that I'm not alone
while struggling with the debt-mire of lower-to-middle income
Consolidating credit cards to one account
by Scott Bilker
I am a recent college graduate, and I have
accumulated about $4,000.00 worth of debt spread out in 4 different credit
card accounts. I would like to transfer all of the balances to an account
with a lower APR to save money and to make monthly payments more convenient.
The problem is that I have not been able to be approved for a credit card
with a limit of over $1500.00. Besides having multiple cards near their
credit limit, I have good credit and always make payments on time. Is there
anything that you can recommend? Please Help!
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DebtSmart Reader Tips
by DebtSmart Readers
Thanks for submitting
your tips! I'm going to be introducing a few new tips in each issue. So you
can be sure that yours will be out soon. Here are this issue's tips:
Bills: Pay on time
First and foremost, always pay your bills online! That way, nothing slips
through the cracks and you always have an accurate expectation of monthly
expenses. Secondly, invest in an inexpensive scanner to turn your bills/cc
statements, etc... into PDF documents. Simply put, the computer takes a sort of
"picture" of your document and stores it. In this way, you can organize and
store all of your documents on your computer; you can get rid of the paper
clutter, and access anything you need very quickly. Just make sure you make
a backup copy!
Credit Cards: Easy money for
Just in time for the Christmas season, one of my credit cards offered me a
whopping 5% back on all purchases for 3 months (Oct-Dec). They will give me
5% back (up to $100). I plan to change my purchasing habits and use this
credit card for everything I buy. I will pay off the card in full each month
so I don't get charged any interest. At the end of the three months, I will
have a $100 credit to use for anything I want. This is easy money. Note:
This tip is only good for those who wisely pay off their credit card
balances in full. (Unless you have a zero-percent card.)
Read more DebtSmart Reader Tips
"Scott is really the only debt advisor I read on a regular basis
"I enjoy Scott Bilker's advice a great deal. His
Paying off debt is hard work, like others he has written, shows a
flexibility and insight that I do not see in 97% of financial advice columnists. I
like his comment about the reader's ho-hum cliché opinion about paying off debt
as 'a brute force approach.' Almost everyone views credit cards and debt in that
same black and white fashion--seriously overlooking the ways credit can make our
lives better, other ways in handling debt, and the whole other real world
situations that canned financial advice can't even begin to remedy. Scott is
really the only debt advisor I read on a regular basis anymore. I am also a
librarian in a large urban library who is in charge of the finance collection. I
have all of Scott's books for the public to read."
--Michael Skidmore, Librarian
Read about special offer for all three of Scott Bilker's best-selling books
Household Math(tm): Average Daily Balance
Most banks calculate the amount of
interest you owe using the average daily balance method. That method means
adding up the outstanding balance each day in the month and taking an
On day 1 in the month, your balance is $5,000.
On day 15, your payment of $2,000 is credited to your balance. The number of
days in the month is 31. What is your average daily balance?
Answer this problem
by Doris Dobkins
"Think before you act and
then act decisively."
This afternoon, I spent an unexpected 4 hours
at the car service dealer. My vehicle had been overheating for the past few
days so I thought I'd take it in for a service check. There was a leak in
the water pump, so I let them replace it. Not having any other form of
transportation at the moment, I decided to "hang out" in a comfortable chair
on the sales floor.
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