July 27, 2009

• Senior Credit Card Crisis, Pt.2
    What's A Senior To Do?

  Previous...

  Your savings account is diminishing while retirement accounts are drying up. It's a very scary place to be. Your choices; use your credit card or begin selling off assets. In some cases, there are no assets to sell. So what's a senior to do? Here are a few helpful tips on managing credit card usage and debt.

  • If you're using more than two cards, STOP! This can be a double edged sword. You risk losing the card if the bank sees that you have not used it in some time. When a bank closes your account, it has the potential to negatively affect your credit rating. If you must hold on to an additional credit card, you should use it every few months to make a small purchase and then pay the balance off immediately.

  • Be very selective when choosing a card. The new credit card reform bill will become effective in February 2010. Contrary to what many consumers believe, this law is not a safe haven in favor of the consumer. This makes it even more important for seniors to explore all their options. Don't accept the first offer that comes along. Don't be fooled by teaser start up interest rates. Banks are in business to make money. Check the terms and conditions of the card contract to view when and how interest rates will be increased.

  • Check out the credit card's billing cycle terms and conditions. Understand how and when potential late payments generate penalties. Examine how interest is accrued. If interest begins accruing the day of the purchase, your teaser startup interest rate will end up costing you more in the long run.

  • Be very cautious about considering a credit card that is attached to a home equity line of credit. There are some banks that offer some very inviting home equity line of credits, but there are also those that that could ruin you. Have an expert review any contract before you sign.

  Protect yourself and your cards. Identity theft and credit card fraud has become one the fastest growing criminal actives across the globe. Examine your account statements regularly and notify your lender if you notice any unauthorized transaction. 
  
  Back to Articles Main Page