How to build a credit history

In the past, someone who wanted to build their credit history would have a friend or relative simply add them as an authorized user on their credit card account and it would improved the authorized user’s credit score, allowing them to apply for their own cards or loans in the near future. But this tactic, called “credit piggy-backing”, is now obsolete. Authorized users no longer get a credit boost. In order to help someone pump up their credit, it’s now necessary to risk your own through co-signing which many people are not so brave to do.

The way I built my credit history was with a secured Visa card. It's been a while and I don't have that credit card anymore or even remember what company it was but I do remember that I had placed $300 into their savings account and they gave me a credit card with a $300 limit. It didn't feel so good having to give all that money just to get a credit card in that amount but I didn't know any alternatives since I had no one to credit piggy-back with. It worked and years later I had built my credit score enough to get some of the better unsecured credit cards out there. By the way, I remember with that secured Visa you had to keep your $300 in their bank for two years. After that I requested my money back and they returned it to me plus a couple bucks extra interest.

If you don't want to go the secured credit card route then there are credit card companies that offer credit cards that are aimed for people to build a credit history. If you have not ever had any credit many see your credit the same as someone with bad credit so you are in the same boat. Do you have No Credit or Poor Credit? Find the right Credit Card for your situation! here. Another place you can check out is at Credit-Land.com - Find the best credit cards for your needs.

Co-Signing for family or a friend

What do you do when a relative or good friend comes up to you ask you if you can co-sign for them on a credit card or a new car or... This can be an awkward situation. Of course you would like to help them out by co-signing for them but you also know that if they miss a payment that the negative mark will also go in your name too and affect your credit score. If the balance became due in full it would not just be on them but also on you. Keeping your credit good is hard enough but if anyone were going to mess it up you would want it to be you, not someone else.

If you are going to co-sign for someone do it with the mind set that you will soon have to take over these payments. If your mind set is that they will take care of their business the way they should and then they don't you don't want to be surprised with a payment that you can not afford.

Also, make it clear to your relative or friend that if they can not make a payment to be sure to let you know about it so you can make that payment.Nothing worse than them not telling you and just not paying.

It is really risky to co-sign for someone. Personally, the only people I would ever co-sign for would be my own kids but that's just me.

Understanding your credit card statement

Whether you are new to the world of credit cards, or a seasoned veteran, understanding the information in your credit card statement can be confusing. There is a lot of information packed onto a single page, and if you’ve never taken the time to review your statement in detail, it may be a good idea for you to do so. That way you are more likely to notice if there are any abnormalities with a statement that might indicate identity theft or merchant errors.

The statement should display your account number prominently. This is the number that uniquely identifies you to the credit card company. When purchases are made using your credit card, they are all attached to this account number and charged to you. If you need to call customer service for any reason, you will be asked to provide the account number.

If you’ve ever used one of your credit cards and had difficulty making an online purchase or a purchase over the phone because the merchant says your name doesn’t match, it’s probably because you have used a middle initial on your card but not in the checkout process, or vice versa. On your statement you can view your name as it is saved in relation to your credit card account. Jane L. Doe is different from Jane Doe or Jane Lee Doe, so it’s important to note how your account is set up.

The statement date displayed on the credit card statement shows you all transactions that took place between the last statement date and the current one. The payment due date is the date which your credit card company should receive payment in order to avoid late fees and additional finance charges. While some companies allow you to postmark your payment on the due date, most want to receive it by the due date, so plan accordingly.

The credit line shows you how much money the credit card company will allow you to charge on their card at one time. You can charge multiple transactions, but the total amount owed must not go over this amount. If you do manage to spend more than your credit line, you will pay over-the-limit fees. The credit available displays how much of your credit line you still have available to spend.

The new balance information displays how much you have charged and have not yet paid back. If you pay the entire amount in this column, you will not be charged interest. The minimum amount due is the amount of money that you are required to send by the due date.

The transaction list is a detailed listing of everything that has occurred with your account since the last statement. It will detail purchases, returns and refunds, and interest charged to the account. If there is anything you don’t remember buying, contact the company listed in the transaction listing or call your credit card account immediately.

There is also a section that shows how your current balance was calculated. It shows purchases, finance charges, interest, your last payment information, and then the total balance of the card is shown again in this section as well as the minimum amount you must pay that month to stay current with your payments. You should always try to send more than the minimum, if not the entire balance, each month to avoid finance charges, and interest. The finance charge summary section will show you how interest and finance charges are applied to any balance that remains on your card from one month to the next.

Teaching your children about savings and interest

Many children see their parents everyday in life going to ATM machines, sticking a car in it and having money come out. How magical! The child does not realize many times that it is hard earned money that you had to work for.

Giving your child a small allowance is a great tool to teach your children about saving and banking. Let me share my experience of how I do it with my kids.

I give my three kids $5 per week. I tell them that they can spend the money if they want to or they can save it. We have saving boxes for all three of them at our home. Each week I will see how much they have in their savings box and I will pay them 50% interest on their savings, this is my way of showing them how interest works. If they have $20 in their savings box when Monday comes around they will get $10 interest and the new $5 allowance for the week. It's a great way to show them how to save.

I have been doing this for years with them but the only problem now is that my oldest child is now 12 and she's really getting good at saving and I will probably have to lower her interest rate because poor old dad here will not be able to afford to pay her 50% interest. Geez! I hope she realizes that in real life the banks are not so generous. Imagine the disappointment when she grows up and a bank wants to pay her only 1% interest!

Beware of Two-Cycle Billing

The amount of interest you pay is based on your average daily balance. Many card companies have come up with a new method of calculating your average daily balance by considering not only this month’s average balance but also the previous months. The problem with this is that amount is usually higher when you’re in the process of paying off your debt making it even harder to do so.

Lowering your credit card interest rate

So you have a 19.99% interest rate that you pay with your credit card. Will you always pay this interest rate? Maybe some day your credit card company will drop your interest rate because you are such a good customer, fat chance. You can give yourself a chance though if you call them and ask them to lower your interest rate. Most of the time they will, especially if you are a long time customer. These credit card companies want to keep you as a customer and know that you might have better options than them.

If you pay an annual fee for your credit card you can get that waived also. If you pay a monthly participation fee you can get that waived too. Remember everything is negotiable! You are the customer and deserve to be treated right.

Did you get hit with a late fee of $25 or $30. Give them a call right away when you get your bill and ask them if it can be waived. You might want to tell them that you have multiple cards and are looking to see which ones you want to close. This puts you in the drivers seat as mentioned earlier, they want to keep you as a customer.

How to pay off your credit card debt

So you have five different credit cards with high balances and you want to pay off all of your debt are start clean. Which credit card do I pay off first?

Many will want to pay off the one with the smallest balance first, then the second lowest balance next and so on saving the highest balance credit card for last. While this does give our human minds a great sense of accomplishment it is not the way to save money.

The best way is to pay off the highest interest rate credit cards first. You will save a ton of money in the long run. If one of your credit cards has a 9.9% interest rate and you owe $600 on it but you have another credit card that charges you 24.99% interest and you owe $2000 on it you got to tackle that 24.99% interest credit card first. Many credit cards have high interest rates like this and if you are not paying them off quickly it will cost you a ton of money. So remember, the best technique is to pay off debt with the highest interest rate first

Closing your credit card accounts

Sometimes people will rip up their credit card to battle their temptation of using it. They have a plan, they will then pay off the credit card balance in full only to close their credit card account.

Is this a smart move?

It all depends. If you are working at raising your credit score this is definitely not a good move because when you close that account you end up raising the ratio of your used vs available credit which can often hurt your credit score. If you have an excessive amount of cards that you want to close out, that’s fine, but think twice if your reasoning for doing it is to improve your credit score. If you are going to be buying a new car or a home in the not so distant future it would not be wise to close the account. If no major purchases will be going on in your life in the near future and you can afford for your credit score take take a small dip then by all means go ahead and close that account, you can build your credit score back to where it was.

Using the four payment rule to not carry a balance on your credit cards

As a young twenty something person I got introduced to credit cards and being naive figured that if I could afford the minimum payment on my credit cards then I could afford it. Boy was I wrong! I ended up running balances of $1000, $1,500 and $2000 on my three different credit cards. All I could afford to pay was the minimum payments of around $15 per month on each card and when the interest was added my balance would go down around $5 or so. I paid these cards for a couple of years until I finally landed a job were I made enough to make bigger payments and finally paid them off.

My point here is don't ever carry balances on your credit cards for years. I have a new method I use when I make a purchase with one of my credit cards that I call the 4 payment plan. If I can not afford to pay the purchase off in four payments then I can not afford it. If that new plasma television set I want is $2000 and I can not afford to pay $500 per month for it then I can not afford it. If I want that $500 digital camera then I must be able to afford $125 per month for it. This is my method of using credit cards and I will tell you that it has certainly worked for me and I would recommend it to anyone.

Are balance transfers worth it?

Transferring your balance can save you lots of money. You can transfer that high interest credit card you hold a balance on to a low interest credit card that may offer you 0.00% interest for up to one year. In many cases this will work for many people and is certainly worth it to save from paying all those high interest charges.

If you are going to pay off your balance in a few months or so though it would not be worth it to pay the balance transfer fee. You almost always are charged a balance transfer fee when transferring your balance. Do the math and see if it is worth it for you to transfer your balance.

Credit Card Price Protection

What is credit card price protection? Let's say you go and purchase a new television set for $1000.00 and then a couple months later you see that same store selling that same television for $800.00. You might feel like you got duffed but there are things that can be done if you have the know how.

Many credit cards offer a price protection program which will refund you the difference when you purchase an item with the card and you find a better price within 30-90 days. Many people don't know about 'Price Protection' but if used right it can save you thousands and thousands of dollars in ones lifetime.

Understanding Your Credit Card Applications

When you apply for a credit card it is important to understand the deal your getting with that new card. As your credit improves over time you will usually get the better deals but lets go over a few things you should understand.

Annual fee

This is a flat yearly charge similar to a membership fee. The fee could be $40, $50 or even more. Many credit cards that are offered to those with bad credit or no credit will have this annual fee. Of course no one really likes paying this annual fee but it should not be a big problem if you are just starting out and trying to establish your credit. Soon enough you will be able to get the credit cards with no annual fees! A tip you might want to remember is that after being a customer for a while you can call the credit card company and ask them to waive this fee. Some will since they would rather keep you as a customer than lose you as a customer.

Monthly Participation Fee

This fee is usually a $5 or so fee that is charged to you every month. Again, this is usually offered to those with a shady past credit history. It is another method to rebuild your credit history.

Finance charge

The dollar amount you pay to use credit

Besides interest costs, this may include other charges such as cash-advance fees, which are charged against your card when you borrow cash from the lender. (You generally pay higher interest on cash advances than on purchases -- check your latest bill to find out what you're paying for this service!)

Grace period

A time period, usually about 25 days, during which you can pay your credit-card bill without paying a finance charge

Under almost all credit-card plans, the grace period only applies if you pay your balance in full each month. It does not apply if you carry a balance forward. Also, the grace period does not apply to cash advances.

Annual percentage rate (APR)

The yearly percentage rate of the finance charge

Interest rates on credit-card plans change over time. Some of these adjustments are tied to changes in other interest rates, such as the prime rate or the Treasury Bill rate, and are called variable-rate plans. Others are not explicitly tied to changes in other interest rates and are called fixed-rate plans.

Fixed rate

A fixed annual percentage rate of the finance charge

Variable rate

Prime rate (which varies) plus an added percentage (For example, your rate may be PR + 3.9 percent.)

Introductory rate

A temporary, lower APR that usually lasts for about six months before converting to the normal fixed or variable rate (This is a hot topic -- more about it later.)

Experts say that if you're smart, you'll do the same kind of comparison shopping for a credit card that you do when you're looking for a mortgage or a car loan. This is a good idea because the choices you make can save you money. It is true that you will not get the best deals when starting out but as your credit gets more better and better look for those better deals out there.

Transfering your credit card debt

Would you like to know how a credit card balance transfer can save you hundreds of dollars from your credit card bills? Do you currently have trouble keeping up with your credit card balances? If yes, then a balance transfer may just be what you need.

Getting a Balance Transfer Credit Card

What is a Balance Transfer credit card and how is it different from standard credit cards in the market? If you try to shop around for credit cards, you’ll notice that some credit cards offer 0% APR as part of their introductory offer. The 0% interest rate will usually apply on purchases but if you take a look closely at your choices, you’ll find credit cards that offer 0% rate on balance transfers. If you’re lucky, you can even find a credit card that offers 0% APR for both purchases and balance transfers.

Why should you take advantage of 0% balance transfer credit cards? Carrying over your balances with each billing cycle increases your debt due to additional interest fees. With balance transfer credit card, you can focus on paying your original charges without the interest. Do the math, and you’ll realize how much you can save from the interest rates alone on your existing balances.

Finding the Right Balance Transfer Credit Card

Does this mean that all balance transfer credit cards are right for you? Take note that different credit card issuers also provide a variety of terms and conditions. Naturally, you’ll want to go with a company that will give you the best deals.

For instance, how long will the 0% introductory period last? Never forget that the zero interest offer is just a temporary option. Some companies offer as little as three months while others offer up to a year or more. Ideally, enjoying at least 12 months of 0% interest offer should give you enough time to repay your balances completely.

How much is the interest rate after the introductory period? Will the interest rate still be reasonable when the introductory offer ends or will it soar high? It’s best to choose a card that will still give you a reasonably low interest even after the 0% APR expires.

How much is the interest on purchases? If the 0% APR is limited to balance transfers alone, how much will the interest be on your charges? If the interest on purchases will be expensive, you may want to consider using this particular card for balance transfers only.

Another thing to keep in mind is how much are the annual fee? Some balance transfer credit cards may have very expensive annual fees. If you have to pay such a large amount each year, will it still enable you to save your money? There are balance transfer cards that have no annual fee so you’ll want to take your time looking for the right card to fit your needs.

What Credit Card Numbers Mean

Have you ever wondered what all those numbers on your credit card mean? Although phone companies, gas companies and department stores have their own numbering systems, ANSI Standard X4.13-1983 is the system used by most national credit-card systems.

The front of your credit card has a lot of numbers -- here's an example of what they might mean.

Here are what some of the numbers stand for:

* The first digit in your credit-card number signifies the system:
o 3 - travel/entertainment cards (such as American Express and Diners Club)
o 4 - Visa
o 5 - MasterCard
o 6 - Discover Card

The structure of the card number varies by system. For example, American Express card numbers start with 37; Carte Blanche and Diners Club with 38.

American Express - Digits three and four are type and currency, digits five through 11 are the account number, digits 12 through 14 are the card number within the account and digit 15 is a check digit.

Visa - Digits two through six are the bank number, digits seven through 12 or seven through 15 are the account number and digit 13 or 16 is a check digit.

MasterCard - Digits two and three, two through four, two through five or two through six are the bank number (depending on whether digit two is a 1, 2, 3 or other). The digits after the bank number up through digit 15 are the account number, and digit 16 is a check digit.

Don't max out your credit cards

There was a time when I had a handful of credit cards and would make my payments every single month on time but it seemed as if my credit score was not going up much. I wondered why and what more could I do to make my credit score go up faster. Then I discovered that maxing out your credit cards is not the way to do it. You see, I had 5 credit cards with my combined credit limit at about $4000.00. My combined balance on all of these stood at $3,500 to $3,900.00 for about 5 years, I never paid it down. Once I discovered this I started paying my debt off and would knock off about $400.00 per month and after a years time I still had some balances but only owed $770.00 out of my $5000.00 combined limit. My credit score drastically shot up over 100 points in that year and I also got automatic credit card limit increases from 3 of the companies.

Take it from me - Don't max out your credit cards! Try to keep your combined balance to about 30% of your total combined credit limits.

Pay more than the minimum payment on your credit cards

The worst thing you could do with your credit cards is to pay the minimum payment every month. OK, we all know times are hard sometimes and if you have to pay the minimum payment one month then go on right ahead but to make the minimum payment every single month will really cost you big time in the long run. Some credit card companies even report if you paid the minimum payment or more. Take a look at the sample below to see how much paying these minimum payments can cost you.

A handful of credit card issuers have raised minimum payments from 2% to 4% of the balance due. If you can afford these higher payments each month, you'll benefit over the long haul. If you can't afford this increase, chances are you're in over your head. Ask someone at your credit union for help in straightening out your finances.

Consider the example of a $2,000 balance at 18% interest. If your minimum payment is 2% of the balance due each month, it will take you about 19 years to pay it off and you'll pay $3,862 in interest. (A 2% minimum payment would start at $40 and taper to $20. Maintain the $40 and you'll pay off the debt faster. That's what our calculator assumes.)

If you're paying 4% of the balance due, you'll pay off the balance in seven years and four months and cut your interest costs to $1,031. (A 4% minimum payment starts at $80 and tapers to $20.)

By paying 8% of the balance due, much more than the minimum, it will take you three years and nine months to pay off, and you'll pay about $433 in interest. (An 8% minimum payment starts at $160 and tapers to $20.) Remember, these calculations assume you add no more charges to the card.

Always pay the minimum amount due so you don't incur a late fee, and if possible, pay more than the minimum.

Someone steal your identity? Protect yourself!

Identity theft is a major problem. Can you imagine someone stealing your identity and buying themselves new cars, taking vacations, going shopping at the mall or even buying a home in your name? It would be devastating wouldn't it! There are many ways that someone can steal your identity. We can prevent it somewhat by shredding up all of our personal papers before we toss them in the garbage but I want to show you how by even you taking all of the precautions possible your personal information can get into the wrong hands. This is my story:

About ten years ago I had a job as a security guard. A bank trustee hired my company to escort him into a company that owed the bank millions of dollars - the bank trustee was going over there to kick them out and needed us there in case their was any trouble. There was a little trouble but when all was done we had kicked out around 300 employees and gave them only 10 minutes to grab their personal belongings. Locks were changed and boards went up so they needed some private security guards to watch the place for a couple of months. I ended up working there 70 hours per week bored out of my head. One day I strolled into a room, didn't know what the room was but it must have been the human resource room because guess what I had in my hands. A folder with 300 employees names, addresses, salary, their spouses name and all kinds of other information about them. Imagine that, me with all of this info! I could have turned into any one of those people I wanted to. I bet those employees of that company would have never thought in a million years that some guy working as a security guard would have this easy access to their information. Luckily for all of them I am a good guy :) I did not do anything with it especially being a victim of identity theft myself. Someone actually had a couple credit cards in my name, got a job in my name and then went to prison with my name. That's when I found out while looking for employment that I was supposedly in prison at the time. Crazy huh, I then found out that the DMV records showed tickets on my record that this person had gotten. It all got resolved but when someone steals your identity it will make your life a living hell.

Do you know that the experts say that someones identity is stolen every two seconds? I personally never have to worry about anything like that happening to me anymore since I now have LifeLock. LifeLock is the only Identity Theft Prevention Solution backed by a one-million dollar guarantee! Click here to get a 10% discount.


I now never have to worry about anyone stealing my identity. Whether you enroll with LifeLock or another similar company - YOU NEED TO PROTECT YOURSELF!

Don't let divorce mess up your credit

Divorce screws up a lot of people's credit and to be honest sometimes the husband and wife just can not see eye to eye on anything and will just about anything to make the others life as hard as possible. Sometimes though when a couple can work things out together they can make each others new lives as easy as possible. We all know life sucks with bad credit!

Divorce can be one of the hardest things you can go through but when finances and credit card debt are brought into the mix it can make it even ten times harder. Instead of thinking for one household, you have to plan for two. Of course if two spouses can work through this transition together it can be much easier than two spouses who are just fighting for every penny that they can get from the other.

Going through a divorce can be an emotionally traumatic time. Creating a plan to split assets and credit card debt will help tremendously to ease that trauma. Financial companies will consider that any debts that one person in a marriage incurs belongs to both. It will take time to notify everyone about the changes that will occur.

The plan that is put in place to handle credit card debt must allow for an equitable division of those debts. If a couple lets the courts make a decision on what belongs to who usually both parties will not be happy with the decisions that are made, if child support is also an issue it will make the courts decisions even worse. So, it is best to have a plan in place before divorce proceedings begin. It is not necessarily best to have a 50-50 split. A lot will depend upon the income of each party and how much of the debt was incurred by each. If there is only one breadwinner in the family, it will be more difficult to split the debt fairly. Usually the worker will feel that he deserves more since he/she was the one actually going out and making the money but that is why spouses need to compromise.

In cases where there is massive debt, there are even more problems. Debt such as this will probably necessitate the sale of the family home. The proceeds from the sale would go to pay off all debt. Any remaining funds is usually divided between the couple. If there is no family home that can be sold, a plan will need to be put into place for either a loan or a bankruptcy action. There may also be retirement accounts that can be liquidated and other household furnishings that can be sold to reduce the debt.

Sometimes it might be a good idea to contact the credit card companies and let them know about the divorce. They are only interested on how you plan to pay them back and may even be willing to split the debt 50/50 by creating a new account for one of the parties. It is best to negotiate with the credit card company before divorce proceedings have been started.

Another option may be for both people to open brand-new credit card accounts and pay their fair share to the original balance. This is usually done as a balance transfer, however, usually a credit company will provide checks so that you can write one to the original company.

If there is more than one credit card to be dealt with, each spouse could take on the ones that would add up to their agreed-upon balance.

When both people in the marriage have a plan in place before the dissolution of that marriage, a lot of the problems that come from it can be reduced. Even though there can be a lot of recriminations and arguing between the couple, a solution can usually be worked out. Some sort of plan can be helpful even if you can't come up with the total solution. Attorney fees can be cut drastically when a plan to set up beforehand.

Beating Mr. Visa: How A Little Compound Interest Can Save A Lot Of Money

A question that vexes math students and teachers alike - "How does this apply to the rest of my life?" - turns out to have some surprising answers. Geometry in the living room? Statistics in your ledger? Yes, and yes.

Credit cards are ubiquitous in American life; there are probably 2 or 3 in your pocket right now. As of 2004, Americans were toting 1.3 billion total credit cards, and most of those cards' users were feeling the pinch - by the early part of this decade, average credit card debt for individuals had soared to over $11,000. During the same period, credit card companies lowered minimum payments so far that, for example, it may take a cardholder 32 years to pay off a simple $5000 balance at 15% interest. That's a scary figure.

In these times, it's absolutely critical to understand how compound interest works if you don't want to be stuck with out-of-control debt. However, many of us were absent that day in ninth-grade math class, so here's a refresher.

"Interest" is, in effect, money that you pay - or someone pays you - for the privilege of borrowing money. When you put money in a savings account, the bank pays you a small amount of interest for the privilege of borrowing your money, and it works the same way when you "borrow" $50 from your credit-card company to buy, say, that new season of Battlestar:Galactica on DVD. (Hey, I can relate.)

So let's say you put $100 in a savings account at a bank that offers an interest rate of 1%. Interest is calculated and added, generally, at certain time intervals - monthly, six-monthly, annually. Let's say your interest is calculated annually - this means that at the end of the year your $100 in savings will contain your original $100, plus an amount of money equal to the principal ($100) multiplied by that interest rate of 1%. Percentages can also be expressed as decimals: 1% interest, for example, would be .001. 100 times .001 is 1, and that's the amount of "interest" you've gained: $1. Add that to your original balance: you now have a whopping $101. If you'd given your money to a bank that offered a slightly higher interest rate - say, 3 - you'd be doing a bit better: 100 times .003 is $3, which added to that original $100 is $103.

That's simple interest. Compound interest is a little more, well, interesting - it can make you a lot more money if you're the one receiving the interest, and it can hurt you a lot more if you're the one paying out. With compound interest, the money you earn in interest is added to the principal, so it's also gaining interest. Let's say you spend $100 on a credit card that charges monthly 20% compound interest. (What a wonderful world that would be!) If interest is figured monthly, then at the end of the first month you just owe $120.

At the end of the second month that $120 is the principal from which interest is calculated - so now the amount of interest you owe isn't $20 as before, but 120 times .2, i.e. $124. At the end of the third month, interest is calculated again on that $124 - you owe $24.8 in interest, but the credit card company rounds up, so $25 in interest is added, and next month you'll be paying interest on a whopping $149 debt.

This is why even a small credit card balance tends to spiral out of control. And since companies have used low monthly payments to lure in new customers' who don't understand how compound interest works - it becomes easier and easier for a small debt of $2000-5000 to become an onerous twenty- or thirty-year burden. (Many consumers don't realize that this is how the system is designed to work - the longer you're paying off that little balance, the more interest the company makes.

Indeed, in the industry, the responsible card users who keep balances small and pay them off quickly are sometimes derogatorily referred to as "deadbeats.")
But with a little understanding of compound interest - and a little discipline, and, yes, a little luck (no sudden financial emergencies of the kind no one can plan for) you, too, can join the ranks of these "deadbeats" who refuse to be victims of the law of compound interest.

Math Made Easy provides Math help for Algebra help, Geometry help, math homework help using math online tutorial services and math tutorial cd so you can watch your math scores soar.

A brief history on credit cards

Love them or hate them, credit cards are a part of everyday life in the twenty-first century. But where did they come from? Who thought up the idea behind a little piece of plastic that could be used to make purchases?

I remember as a kid going with my mom to the corner meat market. The owner there would grant my mom and other customers who had been going to the store for years credit. He would pull out his messy records and see how much my mom already owed and if wasn't that much he would let her get more goods on credit. This was my first experience with the credit game.

Credit has been with us since time immemorial. In the old days, stores would keep open accounts, or “tabs”, for their customers. The customers would take the merchandise they needed, the store owner would mark their purchases in a ledger, and the tab would be paid at a later date.

Credit in card form was first mentioned in literature in the 1887 novel, Looking Backward, by Edward Bellamy. The author theorized that, in the future, all customers would need to make purchases was a little card that represented their available credit. Now that was a good guess, and timely: Western Union issued purchase cards to its best customers as early as 1914.

Gas cards came before most other types of credit cards. In the 1920’s, more and more people purchased automobiles. Those automobiles needed fuel, so many gas stations began to issue cards which could be used to make fuel purchases. In an innovative networking move, various gas stations even accepted their competitor’s cards as a form of payment.

Next came store credit cards. Originally devised as a marketing ploy, these cards helped increase the customer base of many retailers. Customers liked the fact that they buy now and pay later, and retailers liked the fact that the period of repayment had a definite limit. That is, the customer had a specific amount of time in which to pay off their debt. Good customers gained a good reputation among merchants – the credit history of yesterday.

Revolving credit came onto the scene in the 1930’s and 40’s. The stores started off by allowing customers to pay off their debt over a series of months, requiring the debt to be paid in full before further purchases could be made. Then they did away with the repayment limits. This allowed customers to carry a balance on their credit cards that did not have to be repaid in a specified time period. Instead, the customer had to repay a certain amount of debt each month – the minimum monthly payment. This provided even more convenience for the customers, though many didn’t quite know what they were getting into. Credit card companies made revenue from fees and interest, just like they do today.

In the 1950’s, Ralph Schneider introduced the concept of an all-purpose credit card which could be used in lieu of multiple charge cards. Enter the cards we know today: Visa, American Express, Diner’s Club, and others. These major companies soared in popularity in the 1970’s and 80’s.

Today, credit cards have become a big business. It seems that every provider is eager to place a card in the hands of a customer, regardless of that customer’s credit score or demonstrated level of financial responsibility. This is good news for consumers who want to build up their credit, but can also mean big losses for an industry that was founded on the strength of a promise.

How to dispute bad marks on your credit report

OK, we all know how important your credit report is in today's world. But what happens if there is something on your credit report that you would like to dispute? First off you should have a copy of your credit report already, if not then you need to get one right away. You can easily get a free copy of your credit report online.

Do you see something on that credit report that should not be there? You must dispute it! Any information on your credit report can be disputed! Personal information, accounts, inquiries - ANYTHING! If you have many, many accounts that you want to dispute it is probably best to just start by disputing three or four of them. If you just go and try to dispute all ten accounts on your credit report the credit bureau or credit reporting agency may not take your request to serious.

When you write your dispute letter do not get into laws, procedures or any court rulings. Make it as simple as you can. If your letter gets really confusing there is a good chance that it could possibly get tossed! Concentrate on those three or four accounts and do not mention others that you may want to later dispute and have removed. Fix these problems first then you can think about the other ones.

Once all that is done it will be time for the 'procedural request' - asking for the method of verification. If you get some accounts deleted that's good. But for those that came back "verified" you can ask for a 'procedural request.' The credit reporting agencies and credit bureaus are obligated by law to provide you with the exact method your creditors used to verify the information that they are reporting to the agency on your credit report. Requesting this information, forces the credit bureau to provide you with the information they received from your creditor as valid proof.

The creditor needs to have proof of why if they replied to your dispute stating that your account should remain on your credit report. The creditor rarely ever provides the credit reporting agency or credit bureau with this information. So, by doing this you're putting pressure on them to prove it. Otherwise they will have to remove it.

Make sure to keep records of everything the bureaus and your creditors send to you in case you find some day that you have to sue them for violating your federal rights. If you follow these credit repair tips you should be well on your way to fixing your credit for good!

Do I really need a credit card?

The quick answer to that question is a big NO! You will not drop dead because you don't have a credit card. I know a man who is in his mid fifties who absolutely refuses to get a credit card. The problem is that this man complains and fits when he is having a hard time trying to rent a home or get a vehicle. This man lived in a time when credit cards were not a necessity in life and they still are not but if you want to make life simpler and be able to buy a home one day then you must have some sort of credit. You can not establish any credit without having any credit! So, "should I get a credit card?"

If one day you would like to:

Buy a home

Start a business

Buy a new car

Then you best establish some credit for when you need to do these things in the future.

Here are some other things that you would have a hard time doing without a credit card:

Renting a car - Yep, you need to put a deposit down and that deposit comes from your credit card. They car rental company will usually want you to have a major credit card if they are going to let you use their vehicles.

Renting a hotel - Well this only makes sense don't it. If I live in Los Angeles and need a hotel room in New York for next weekend then I will need to pay for it over the telephone so I will need a major credit card for this task.

Employment - This one is really important don't you think. Many employers now do a credit check before they hire you as an employee. Sometimes your bad credit can keep you from that great job you could have otherwise had.

Renting a home - Remember when you only needed good credit to buy a home. Well as most know now you better have some decent credit if you are going to rent a house or apartment. Wouldn't it really suck if you make some great money but could not get into a home because of your crappy credit.

Cell Phones - Oh sure, you don't need great credit for this one but sometimes the worst your credit is the higher deposit you will have to make.

Turning on the lights! - This is one that I personally recently experienced. I had to call Edison to have the lights turned on in my home. They asked me if it was OK to check my credit and I said OK. The woman said that there would be no deposit since I have great credit. Wonder what the deposit would have been when my credit score was 530 years ago?

These are just a few examples but just know that not having any credit or credit cards can make someones life really miserable. It seems that many who don't want credit cards may have made mistakes with them in the past and went into some serious debt and screwed up their credit. But they need to learn from their mistakes, no one is perfect.

If you have bad credit or no credit you may want to check out Centrro - find the perfect credit card that suits your needs and make a new start.

Should I use a debt consolidation program?

If you are just overwhelmed with debt such as credit cards, medical bills or any other payments you have to make every month then you may want to try using a debt consolidation program. These programs can really help someone out a lot as you can get your monthly payments reduced and roll your debt into one easy monthly payment. Now, wouldn't this make life a little simpler! This helps you avoid having a ton of bills scattered all through the month without the ability to pay them. It also helps you avoid bankruptcy and can rebuild your credit within a couple of years.

When you choose a debt consolidation program, you are avoiding the damage that bankruptcy can do to your credit. When you file bankruptcy, your debts may be wiped out, but you also have the bankruptcy recorded on your credit report which is never ever a good thing. This means that for several years you will have significant difficulty with getting any new loans, buying a house, or starting to rebuild your credit in any way. Banks will consider you a risk and will treat you as such for 7-10 years, which is how long a bankruptcy will stay on your credit report. Your life is in a standstill, all because you chose to file bankruptcy. This should always be a last resort.

Now, on the other hand let us look at a debt consolidation program. Let's say that you have several different credit cards, with different limits, interest rates, minimum payments and due dates. With a debt consolidation program, all of this will be eliminated. You meet with a counselor either in person or on the phone, and you give them all your account information. The counselor then contacts each credit card company and works out new terms for you. Many times they work directly for the credit card companies themselves, and will be able to get the credit cards to reduce or freeze all interest, as well lower the principal amount that you owe. Sometimes they can even arrange to get late fees reduced or waived.

Once the counselor works out a deal with each individual company, they will set up a payment plan for you. You will have to pay them a percentage, which is usually calculated in your monthly payment. You now will be paying the debt consolidation program one large payment every month, which will take care of all your debt. The credit card companies receive your payments from them.

When you use a debt consolidation program, you are no longer in danger of bankruptcy. The process is not immediate, and it will usually take a minimum of two years to get your debt paid off. This saves you thousands of dollars in interest over the entire period. Even though you are paying the program for their help, it is still much less than what you would pay in interest and fees if you tried to do this yourself. You can usually negotiate how the credit card companies will report this to the credit agencies as well. While many times they may report the balance as settled instead of paid as agreed, it still looks much better than a default or charge off on your report.