“ This is a guest post written by Tom Tessin. He runs FindCollegeCards, a student credit card site / college blog helping future/current college students with everything they need to know about their education.“

Credit cards can be great when you use them the right way. From rewards to getting other types of bonuses, what’s not to love about these pieces of plastic? Sure, there are people that are haters, but what I’ve come to find out is that these people are the same ones that just don’t know how to manage their own finances.

There’s a good chance that you have a credit card in your wallet today. If this is the case, I wanted to show you 5 mistakes that many people make. By avoiding these mistakes, you’re going to find that you can make yourself a better credit card user.

#1 Not reading the fine print: There is so much fine print with a credit card application. Everything from the introductory rates to the interest rate, you’re going to want to make sure you know how long your interest rate will last, as long as your rate is going to change. The more you know, the more you will feel comfortable with your card.

#2 Taking out a cash advance: This is honestly one of the worst things that you can do. People tend to think that it is a great option to take out a quick, fast loan, but what they don’t realize is what they are going to be charged in terms of interest rates. A cash advance can easily set you back 30% in interest.

#3 Not paying the bill or avoiding it: Let’s say that you don’t have the money to pay off your credit card bill. If you can pay off the minimum, at least attempt it. As long as your bill isn’t through the roof, you’re going to find that you can easily pay the minimum. Never just ignore your bills as this is going to kill your credit score in the long haul.

#4 Not knowing how rewards work: There are some great rewards out there when it comes to credit cards. What you’re going to find out is that if you don’t pay your bills off in full, you’re not taking advantage of the rewards. The reason is because you’re going to be paying more in interest than the rewards coming back. Pay your bills off in full and you can avoid the interest rates all together.

#5 Getting too many cards: You really only need 1 credit card. There’s no reason to sign up for 100s of them. Sure, a free t-shirt may be tempting, but you may be bound to use more than one in the future. The chances of them snowballing and adding up fast can happen, so be sure to avoid this one!

As you can see, many mistakes are common sense. Just use your head and see what’s best for your wallet. Treat your card like cash, pay it off in full each time, and there should be no worries!

The Good News:

In December of 2009, the Office of Thrift Supervision issued a stinging 300page report about the credit card industry saying the tactics used by credit card companies are “unfair, unreasonable and deceptive.”

This prompted the Credit Card Accountability, Responsibility and Disclosure Act, signed into law by President Obama in May of 2009.

The Bad News:

The law President Obama signed in May 2009, doesn’t go into affect until July 1, 2010. That means the credit card industry had a full 18 months to continue being unreasonable, unfair and deceptive, while they were getting their house in order. Less than two months from now

The Fine Print:

So now that the credit card companies have had more than a year to clean up their act and implement the new rules they must play by, lets take a look at what we as consumers can expect.

1. New credit card recipients will be happy to know that your interest rates cannot be raised in the first year after the card has been issued to you.
2. The credit card company’s ability to raise your interest rates when you make late payments has been somewhat limited. What this means is, if you make a late payment they can raise the interest rate on any new purchases or charges you make, but they can’t raise them on previous existing balances before you made the late payment. (Known in the industry as double cycle billing) This also means your monthly statement will have different sections showing the previous rate charges on the previous balances and the new rate charges on the new purchases you made and after your late payment arrived.
3. Credit card companies now have to give you at least 21 days to pay your bills. In the past if your payment was due on say the 17th of the month, you would get your billing statement in the mail on the 4th or 5th day of the month, giving you only 12 days to make the payment.
4. You may have not known about this one but if you read the fine print on your billing statement, the time of day on the due date was also stipulated. Meaning, if the billing statement said your payment was due on the 17th, the fine print also specified by 12PM on the 17th, or something similar to that If your payment got delivered with the afternoon mail after 12:00, your payment was considered late and they could hit you with late fees.

These are just some of the changes taking place for credit card users after July 2010. In part four of this series I will cover more of the changes you can expect and they are not all so user friendly.

If you would like more information on managing your finances, go to http://thecreditsaver.com/index.html

Useful reading:

Personal loans for people with bad credit – Unsecured personal loans by a best online company for bad credit peoples .Apply at low interest rates loans from trustable online companies .

Financial Reform and Education Part II

In part one of this article I covered how the U.S. Government; as a result of the 2008 financial crisis, has realized the need for financial reform and education. They cite various study findings showing most Americans don’t have the knowledge and skills necessary to make financial decisions for themselves or their families. In short, we don’t know how to manage our money.

In one study, 2,500 teachers and 76,000 high school students all across America volunteered to have their financial literacy tested. The results were very disappointing. Students and teachers alike, failed to answer basic questions about credit card usage and insurance.

The Financial Industry Regulatory Authority (FINRA) did a study in conjunction with the Department of the Treasury and found that too many Americans don’t have sufficient savings for emergencies and they spend too much money on bank and credit card fees.

And Speaking of Credit Cards

I call credit cards the McDonalds of the credit industry because billions have been sold. Everyone has at least one credit card and most people have more than one. In December of 2009, the Office of Thrift Supervision issued a stinging 300page report about the credit card industry saying the tactics used by credit card companies are “unfair, unreasonable and deceptive.” This prompted the Credit Card Accountability, Responsibility and Disclosure Act, signed into law by President Obama in May of 2009.

While this new law put into affect new control measures requiring credit card companies to clean up their act and to some degree, level the playing field between consumers and credit card companies; it won’t go into effect until July 1, 2010, essentially giving the credit card companies more than a year to continue playing by the old rules.

There is an underlying irony to this new piece of legislation, which was the result of a combined effort by three different agencies: The Office of Thrift Supervision, The Federal Reserve and the National Credit Union Administration. The irony I speak of is this. The U.S. Government by appearance, is asking for financial reform and accountability. But the people they are asking to come up with the new laws that will protect consumers are the very same people who have allowed the past abuses to happen in the first place. It’s like asking the fox to guard the hen house.

While I believe it’s the public outcry that has spawned this new legislation, its hard to believe that bankers and credit industry officials would want to give up the tactics they’ve been using all along which have been obscenely profitable for them. For example, the Federal Reserve is not a federal agency, contrary to what most folks believe. It’s actually a private bank whose board of directors is made up for the most part, of bank presidents from other banks. And they all have very strong lobbyists working for them trying to make sure the rules of the game will continue to protect their interests, mainly being profitable.

So maybe we’ll see an end to things like sub-prime mortgages and the fly by night lending institutions; who exemplified predatory lending, may dwindle in number. But that doesn’t mean the rules of the game have or will change that much. While we will see some changes in the lending and credit industry, the best protection consumers have is to stay informed and gain a better understanding of how to use the tools of commerce.

In Part III of this series I will discuss some of the changes that have taken place as a result of the new Credit Card Accountability, Responsibility and Disclosure Act.

If you would like more information on managing your finances, go to http://thecreditsaver.com/index.html

Learn how you can Beat The Bank with: The Credit Saver and get out of debt.

U.S. Treasury Secretary Tim Geithner on April 28, 2010, wrote an OP-ED piece in the Huffington Post along with U.S. Secretary Arne Duncan and Senior Advisor and Assistant to the President, Valerie Jarrettt; about the need for financial reform and financial education for all Americans.

Last Year, The Financial Industry Regulatory Authority (FINRA) did a study in conjunction with the Department of the Treasury and found that most Americans are financially illiterate. When it comes to managing credit cards, calculating interest rates to compare costs on loans, or trying to figure out how much money to save, Americans are at the rear of the class. The study found that young adults are the least money savvy when it comes to managing money, and most older adults are not much better off. In short, we can spend money, we just don’t know how to manage it or save it.

But rather than pointing fingers, there is a much more important question to ask here. Why? When we have a world economy that is driven by money and credit, why are so many of us ignorant of the skills necessary to use and manage our money or using credit?

Well for one thing, unless you go to school for banking, finance or accounting, you will never get the skills necessary for financial survival. And while you don’t need to be a CPA or a Banker to learn these skills, the truth is, even the basic skills necessary for understanding today’s financial tools are not taught to the average person except through the school of hard knocks. In short, the only ones who really know the rules of the game are the guys who write them.

But you shouldn’t have to go through a bankruptcy or financial meltdown in order to develop a basic understanding of how to manage your finances or to use credit as a tool that works for you instead of the other way around.

It took the global financial meltdown of 2008, to make not only Washington realize the game of finance is in need of serious reform and regulation; but the rest of the world as well. Greece, Russia, Japan, China and a host of other countries have all learned the same hard lessons. That the rules of the game need to be put on a level playing field so that everyone involved in the game has a fair chance of succeeding at it.

This insight also raises more questions in need of answers. How do you regulate an industry where the primary motive is financial gain, without letting the major players and rule makers stack the deck in their favor? How do you minimize greed and corruption? How do you make sure everyone involved understands the rules and the consequences of playing the game and playing it fairly? It all comes down to transparency and education. Know what the rules of the game are and learn them so you can play!

A simple metaphor I like to use to explain this concept is the game of football. Imagine knowing nothing about the game and trying to play it successfully. It won’t happen. In football, the object is to win. That’s done buy using rules, strategy and skills. A football team uses those tools to make sure the opposing team is prevented from doing the same thing. In the finance and credit industry it’s the same thing except they call winning, making money, your money!

If you would like more information on managing your finances, go to http://thecreditsaver.com/index.html

MBA students as well as all others may have already known about the new credit card act that went into effect 22 February, 2010. The new Credit Card Accountability, Responsibility, and Disclosure Act were signed by the President of the United States in May of 2009. It goes into effect on February 22, 2010. So let’s have a closer look at this topic.

Is it tougher to get a student credit card now?

Yes. Now it will be harder to get credit cards. Especially if you are below 21 than the credit card means a lot to you. It will be harder to get a credit card if you have no proof of income or co-signor with good credit. Earlier you could go to class on the first day and return home with new shiny credit card and a new Frisbee. Forget about it now.

The new law credit card is no good for you if you are an entrepreneur. As it can be difficult for a young to prove his/her income/earning potential. In addition as an entrepreneur, there is a good chance that you want to build your credit in the future (mortgage, car, or even rent). Until you hit the age of 21 you are either need a co-signor or any way to prove you have money income. If your parents have bad credit they will not be able to co-sign for you. If you have problems with proving you have a steady income and your parents have less than stellar credit, you will have to wait until you are 21 as binge drinking and hold a credit card.

Consequences of the credit card act for parents.

So let’s say your child is trying out his/her new credit card and debt accumulates. Not your problem? Well, not anymore. You are a co-signer now! If your child does not make their monthly payments, defaults, and comes into the risk of completely destroying their credit, you can help. I know that sucks, but financial education is now becoming even more important. On the bright side, you now have more control of your kids financial situation. You will not be surprised to find out that your (18-21 years old) came home from school with 3 different credit cards.