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ISSUE #192

Email Newsletter  

  December 24, 2008  

Scott Bilker
Scott Bilker, founder of DebtSmart


You hear a lot about "cold hard cash" so I was wondering--where did that expression come from?

The phrase "cold hard cash" was coined (ha!) by merchants and traders who were used to handling coins that, because of their high gold and silver content, were warm and soft and did not wear very well. When more durable metals came into use, it was generally noticed that they were cold and hard.

Of course everyone is thinking about "cold hard cash" because of the current condition of today's economy. From banking to the auto industry and beyond, the world hasn't seen such economic breakdown in history. However, I am optimistic. Well, maybe opti-pestic--more opti than pesti if you know what I'm sayin'.

I have a feeling that the worst may be over or at least the perception of the worst is near over. That said, I am looking forward to a positive 2009. Just a few days away. Tic-toc, tic-toc. Hey, that reminds me, another season of 24 is ready to start. See, everything is getting better already.

Happy holidays to you and yours and best wishes for good health and prosperity for the new year.

PS: CNN asked me to talk about the new credit card rules on CNN Newsroom this past Saturday with Fredricka Whitfield and Josh Levs. You can see the video here. (I pointed out a few places that I see where the banks have loopholes.)


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In This Issue

Cool Quote
Negotiation persistence saves $21,000
STATISTIC: Credit Card Use Drops
New Rules Requiring an Automated Voice or Keypress Opt-Out for Recorded Message Telemarketing Calls Take Effect 12/1/08
Fraud Alerts and Fraud Freezes
"My credit score is soaring"
Bad Credit Hotel
Household Math™: Timing Is Everything
Organize Your Children and Save Your Sanity
If Dad Can Do It Himself, Maybe He Shouldn't

Cool Quote

"Life will pay whatever price you ask of it."
--Anthony Robbins

More cool quotes from past issues

Negotiation persistence saves $21,000
by Scott Bilker

The best part about DebtSmart Online, for me, is when I get email from readers about their success. Amy and I have been corresponding about her situation regarding settling a debt. When you settle a debt, your goal is to negotiate with the creditor for a deal that benefits everyone. For the debtor, this means reducing the balance and making the payment terms reasonable. For the creditor, it means larger payments and a guarantee of payment in a specific amount of time.

The trick is knowing how low the bank will go when dealing with them or their third party representatives (debt collectors). Typically, I've found that you can, on your own, get the amount down to about 50% of the original balance. However, the bank will usually want that settlement amount in one payment.

In my latest book, "Talk Your Way Out of Credit Card Debt," I present one chapter (chapter 7, no joke intended) where I negotiated a settlement for a friend. This chapter includes all the phone call transcripts from those negotiations. I was able to get the bank to 55% with one payment, which I thought to be pretty good. I am thrilled to report that...

Finish reading this article

STATISTIC: Credit Card Use Drops

Wal-Mart's U.S. division told investors, in October, that credit card payments as a percentage of total payments fell 7.4 percent so far in the current fiscal year, which ends in January. That's a big reversal from the robust double-digit growth rates in credit cards over the past three years. Also, Target executives told investors in October that it's seeing lower credit card usage among its shoppers for the first time since 2001-2003.

More credit card and debt statistics

New Rules Requiring an Automated Voice or Keypress Opt-Out for Recorded Message Telemarketing Calls Take Effect 12/1/08

Effective today, any telemarketing call that delivers a pre-recorded message must include a quick and easy way to opt-out of receiving future calls. The opt-out must work both for consumers who answer these calls in person and for those whose answering machines or voicemail services receive the calls.

Pre-recorded telemarketing messages are permitted only in limited circumstances – only when the caller has an established business relationship with the consumer being called. Now, additional restrictions on pre-recorded messages are going into effect. Under Do Not Call amendments adopted in August, effective today, any permitted pre-recorded message must provide the called consumer with an interactive means to opt out of receiving future calls from the seller or fundraiser using the pre-recorded message. Moreover...

See story here

Fraud Alerts and Fraud Freezes
by Andy Jolls

First, what is a Fraud Alert?

An alert places a statement on your credit report so that if a fraudster attempts to obtain credit in your name, the creditor, in checking your credit, will encounter a statement that says something to this effect: "I may be a victim of fraud. Call me at my phone number 312-555-7890 before extending credit." By calling you, the creditor ensures more security.

There are two types of Fraud Alerts:

The first and much more common is a 90-day fraud alert. This is for someone who "suspects" they have been an id theft victim, but doesn't know for sure.

So, I setup a 90-day alert a few weeks ago, and here's how it impacted me. When I went to switch cell phone carriers, instead of the normal online credit check they usually do--yes, your credit score is checked when you apply for a cell phone plan (did you know this?)--they tried to call my contact number to verify it was me. So my old cell phone rang, and then I was able to verify over the phone that, yes, it was me trying to order a new plan. My visit to the cell store was longer, but it was a lot safer.

Finish reading the article

"My credit score is soaring"

"Even though I previously worked for credit card companies, I had gotten myself into debt with fees and high interest. I read the DebtSmart book, and I felt empowered. Scott gave very reasonable and easy ways to talk to representatives and make requests. I called my credit card companies and started by just asking how long I had been a member, as Scott advised. Even though I have relatively new credit (under 10 years), many companies consider me a 'valued customer' and didn't want to lose my business. They increased credit limits, allowing me to consolidate debt (and destroy the cards, but not close the account as per Scott's advice). Some companies erased fees and lowered interest rates. My credit score is soaring. I've helped many family members and friends improve their credit. My mom, who filed for bankruptcy 6 years ago, has a better credit score than her husband, who has never paid a bill late, no charge-offs, and no bankruptcies."


Learn how to "Talk Your Way Out of Credit Card Debt"

Bad Credit Hotel

The U.S. Treasury Department unveiled a new multi-media campaign aimed at combating financial illiteracy. "Many consumers need to better understand how to control their credit," said U.S. Treasurer, Anna Escobedo Cabral.

"Consumers can face serious problems when they make uninformed choices about borrowing," said Dan Iannicola, Deputy Assistant Secretary for Financial Education. "The goal of this campaign is to equip Americans with the knowledge to take advantage of the positive aspects of credit, while avoiding its pitfalls."

Checkout the Bad Credit Hotel--a scary place indeed!

See story here

Household Math (TM): Timing Is Everything
by Scott Bilker

Out-of-pocket cost versus payment timing; what is the effect? Here are three $2,000 loans that are paid off in exactly one year: (1) payments of $180 per month for 12 months; (2) eleven monthly payments of $100 and a final payment of $1,060; (3) monthly payments one through five are $100, the 6th payment is $1,060, and the remaining monthly payments are $100. Which loan is best (i.e. has the lowest interest rate)?

Answer this math problem

Organize Your Children and Save Your Sanity
by Gregory Thomas

It may be difficult to relate saving money with organization, but the two terms really go hand-in-hand. If you are able to organize right down to the smallest detail, then not only will you save yourself countless panic headaches, but you will have more time on your hands, allowing yourself to be more productive and get more accomplished.

Organizing your own personal belongings can be a daunting task in itself, however, if you're also trying to take care of all your children's things, it can be an overwhelming, impossible task.

When children are old enough and capable, they have a responsibility to take care of their own belongings. This includes (but not limited to) toys, clothes, bathroom items, sports equipment, and of course school books and supplies. It should not be the parents' responsibility to clean their child's room, or pick up their wet towels off the bathroom floor. How is this teaching children to be responsible for their own belongings?

Finish reading this article

If Dad Can Do It Himself, Maybe He Shouldn't

ISAAC: "Check your bank statement -- there's something wrong," my dad warned me over the phone last week.

I looked over the statement that had just arrived, searching for this mystery problem. He was right: The bank had been charging me a $25 monthly service fee on the "free" checking account I had opened last April.

But I wasn't too worried about it. I assumed that a bank teller would right the problem as soon as I visited the bank and told them of their mistake.

I was wrong.

See story here

The author(s), Press One Publishing, and DebtSmart.com shall have neither liability nor responsibility to any person or entity with respect to any loss or damage caused, or alleged to be caused, directly or indirectly by the information contained in this email newsletter and/or at the DebtSmart.com website. The information, methods and techniques described may not work for you and no recommendation is made to follow the same course of action. Every effort has been made to verify the accuracy of all content contained herein. However, there may be mistakes; typographical, mathematical, or in content. This email newsletter and the DebtSmart.com website have been created for your entertainment only. You must always seek the proper professional advice before taking any financial or legal action. You have been warned. Copyright ©2008 Press One Publishing. All rights reserved. Please do not reprint, or host on your web site, without explicit permission. However, if you found this newsletter helpful, we grant you permission, and strongly encourage you, to e-mail it to a business associate or a friend. Thank you.

The DebtSmart Email Newsletter, ISSN 1538-6740, is written and published by Scott Bilker and edited by Larissa Bilker and Denise Troy. Please contact comments@debtsmart.com with any comments, problems, or concerns. (See the very bottom of the email to make changes to your subscription.)

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