In this economy, we don't need the big financial institutions looking to our credit cards to make up for their losses. But right now, the credit card companies hold all the "cards," and they can hike interest rates on our balances or charge us higher fees for no reason whatsoever.

The Senate may vote on a bill that will rein in these abuses. The House has already passed its bill, so real reform is within reach. I just sent my Senators an email in support of this bill. Would you take a moment to do the same?

Among other things, the bill would prohibit credit card companies from arbitrarily hiking interest rates on your card balances, and stop 'bait and switch' clauses that let them charge fees and change interest rates for any reason whatsoever.

The bill will help level the playing field for consumers and help ensure that a deal is a deal when it comes to your credit card company. The more consumers the Senate hears from, the better chance we have at putting Main Street, not just Wall Street, first.

Take action here.

Best,
Scott
PS: I ran across a bundle of free holiday ebooks. Everything from recipes to holiday history. You can find them all here.

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In This Issue

	Cool Quote
	Paying off debt is hard work
	STATISTIC: Consumer Bankruptcy Filings Up
	Emergency Economic Bailout Bill Extends Tax Breaks for Individuals
	"We the people..." of Debt
	"Debt Settlement"
	Why banks are boosting credit card interest rates and fees
	Household Math™: Coupon Shopping
	Dynamic Maps of Bank Card and Mortgage Delinquencies in the United States
	Work-At-Home Jobs That Really Work!

Cool Quote

"Those who understand interest, earn it; those who don't, pay it."
--Unknown

More cool quotes from past issues

Paying off debt is hard work by Scott Bilker

Scott,

Your advice on several topics lately has been about moving around debt to produce the lowest APR or the most savings to consumers. However, it does not cover anything about the hard work of actually paying off the debt. The point of this website should be to pay off your debt and not just pushing it around from one account to another.

For example, your most recent answer to a reader who wanted to charge a car purchase on a credit card was missing half of the answer. When you obtain a car loan, the loan is paid off within a period of time, say 5 years. This time period cannot be changed unless the entire loan is refinanced. This requires the buyer to pay an amount that covers interest and a significant portion of the principal. However, when you finance the purchase, say on a credit card, the payment period can be as short as 1 year or as long as 30 years. If you paid the minimum monthly payment on a credit card, you could easily pay more in interest than if you took out a car loan.

Example, if you took out a 5-year car loan for $15,000 at 6%, your total interest is $2,400. If you purchase the same car $15,000 at a special credit interest rate of 3%, but take twice as long to pay it off, it will cost you $2,402. It would be easy for someone to say, "Well, just pay it off early," but you and I know, that is easier said than done. And this is the point I want you to address in your future advice. Paying off debt is a psychological issue. The psychology of paying off your debt fast and using your credit to make money not spend it.

Joseph

Finish reading this article

STATISTIC: Consumer Bankruptcy Filings Up

U.S. consumer bankruptcy filings increased 28.6 percent nationwide in September from the same period a year ago. While representing an increase from the previous year, the overall September consumer filing total of 88,663 represented an 8 percent decline from August. Chapter 13 filings constituted 33.5 percent of all consumer cases in September, a slight increase from August.

More credit card and debt statistics

Emergency Economic Bailout Bill Extends Tax Breaks for Individuals

Legislation Includes Relief for Taxpayers: The landmark legislation enacted Oct. 3, 2008 to help rescue the U.S. markets and the economy also contained a bundle of income tax breaks for individuals. The biggest ones are known as "extenders" --popular tax breaks that might seem permanent to most taxpayers, but actually must be renewed every year or two.

Congress had been expected to pass them by year's end.

Included in the Emergency Economic Stabilization Act of 2008 are more than 100 tax provisions worth $150 billion in tax benefits. They include...

See story here

"We the people..." of Debt by IOUSA The Movie

Wake up, America! We're on the brink of a financial meltdown. I.O.U.S.A. boldly examines the rapidly growing national debt and its consequences for the United States and its citizens. Burdened with an ever-expanding government and military, increased international competition, overextended entitlement programs, and debts to foreign countries that are becoming impossible to honor, America must mend its spendthrift ways or face an economic disaster of epic proportions.

Note from Scott: I just received a link to this video. It's the short version of the movie. This video explains just how much trouble we're in as a nation. A nation of debt. It covers this history of our national debt, which we've had since the start of the country--but there was one time it was $0--amazing. I highly recommend you watch this because our future really will depend on how the nation deals with today's financial crisis.

Finish reading the article

"Debt Settlement"

Scott,

I received your books today. Wow, did they arrive quickly. I immediately read the section on Debt Settlement and would like your opinion. My husband worked for Bear Stearns for 32 years, and due to the JPMorgan takeover (NO - we did not get a bailout), we lost almost $500,000 and at year's end, his job. We will be going to less than half the income which will make paying our debts on a monthly basis impossible. We have a large amount of debt (over $80,000.) with no late payments at all. It is our hope to be able to pay off all our debt from a small settlement after the new year. I am wondering if you think it might be feasible, in this most horrid economy, to ask for debt settlement with the stipulation of not reporting negatives to the credit bureaus, since our credit is very good, but we just have a bit too much. Your opinion would be appreciated.

Cynthia

--------------------------------

Cynthia,

Yes, absolutely! Be sure that they agree to report the account as "paid as agreed." If they do agree to those terms, get them to send you something in writing before you send them payment.

Good luck and please let me know what happens!

Best,
Scott

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

Why banks are boosting credit card interest rates and fees

Tommy Newsom was shocked when his bank nearly doubled his credit card interest rate this year, to 27%, for no apparent reason. A customer rep told him the law allowed the bank to do so, and that was all the justification it needed.

"I never missed a payment," says Newsom, 63, of Mesquite, Texas, who owes about $5,000 on the card. "The bank is just looking for a reason to maximize profits."

In recent years, banks have sharply raised interest rates and penalty fees on credit cards. As the economy tanks and banks' mortgage-related losses balloon, some banks are stepping up such increases to boost revenue. Bearing the brunt are consumers for whom a jump in rates and fees can make it tougher to pay their bills at a time when household budgets already are being stretched.

See story here

Household Math (TM): Coupon Shopping by Scott Bilker

You have two coupons for orange juice. One is for Minute Maid the other is for Tropicana. You like, and drink, both brands. The coupon for Minute Maid is for 2 half-gallon containers for $3. The coupon for Tropicana is $4.99 for a 96-ounce container. Which orange juice is the best deal? That is, which has the best price-per-unit volume? Hint: there are 128 fluid ounces in one gallon.

Answer this math problem

Dynamic Maps of Bank Card and Mortgage Delinquencies in the United States by The Federal Reserve Bank of New York

What are the delinquency rates of credit cards and mortgages? You may be surprised to find out the facts.

Use this interactive map to see what the delinquency rates are in your state--even in your county!

Finish reading this article

Work-At-Home Jobs That Really Work!

With the economy as bad as it's been in 25 years, and new layoffs every day, more and more of us would love to find a work-at-home job that really works.

So I'm going to show you how to find one that's worth pursuing... and is not just another scam waiting to take your money.

See story here

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