OT- "Unfair" credit card fees

[Andrew]

I was blisfully pumping $82 into my gas tank today when an ad at the bottom of the pump caught my attention. It was an ad for Unfair Credit Card Fees.com. I got home and started reading what it was about and was sad to see I was correct in my first assumption.

They are trying to pass HR5546/S 3086 that will "put an end to credit card company price fixing".

Is that how it works? You don't like the price of something you complain to congress to pass a bill that sets their prices to something you can live with? Well if so why don't we just do that to oil and everyone can go across country for vacation again.

Seriously, If you don't like paying the credit card company your hard earned money: STOP USING THEIR CARDS!!

Next thing you know they will be coming into your business saying, "Well John Doe, we've been getting complaints that your prices are too high. Surrender all you books and we will get back to you in 6-8 weeks to let you know what your new prices will be".

[AJMD429]

Yep - a nation of whiners, cowards, and leeches, is what the U.S. has become , with the majority of voters lacking any sense of principle, any understanding of basic economics, or even logic, and voting only for their personal short-term gain, vs. any concern for future generations or the concept of Liberty.

The HOPE we must have is the realization that there is the strongest undercurrent of Libertarianism (call it what you will) which runs in the veins of many in this nation, particularly the rural, self-sufficient, and properly educated. It is embedded in our values, our behavior towards others, our religious beliefs, and how WE vote.

It isn't enough yet to 'win' major elections, even though it was the default philosophy of our nation's founders, but IF (and here's where OUR responsibility comes in) we raise our children to understand AND LIVE these values, and IF we educate our friends and acquaintances about the principles of Liberty, so they can see through the media spin and political smoke and mirrors, we CAN maintain, and even restore, our freedom.

This forum is mostly for the 'fun' part - enjoying a hobby which only happens to involve tools and activities central to that freedom. Be very GLAD Hobie and AmBraCol have provided this 'meeting place' where we can exchange fun information about our hobby, and more importantly, where we can 'meet' and realize how many, many, others around the nation and world SHARE our values.

USE that encouragement and enthusiasm to SHARE our values with those miserable souls who've never fired a levergun, or grown/hunted their own food, or tasted independence in their daily activities (or thoughts)! Coworkers, students, friends, teachers, churchmembers, whoever - TEACH THEM ABOUT FREEDOM...! (We have a church 'shootfest' for the young men and young women a couple of times a year to teach safety, marksmanship basics, and just have fun.)

Guns are certainly a tool to defend freedom when times get desparate, but use them NOW, in the 'hobby' mode we all enjoy, as a 'tool' to get others introduced to our fun hobby, as well as the serious, political, ideas it represents.

OK - I found the soapbox switch, and I'll turn it off now. Sorry...

[Chuck 100 yd]

King Obama will do just that! A chicken in every pot !!

[Ysabel Kid]

The masses don't want to be taught about freedom - they want to live in a Nanny state where the government will do everything for them - and to them - like punish those mean old credit card companies for daring to try to make a profit while covering so many slugs who never pay their debts...

[RIHMFIRE]

I have no credit card debt....
if you cant pay cash for it ....
you dont need it that bad...
They should only be used for emergencies....

[Ysabel Kid]

I have no credit card debt....
if you cant pay cash for it ....
you dont need it that bad...
They should only be used for emergencies....

You are self-disciplined; most American are anything but...

I do use a credit card, but only for convenience and to help maintain my credit rating. I have not had a balance on a card in almost 20 years. You'd be surprised at how high this jacks up your credit rating. Pay everything on time, every time, and pay it all off right away (except for a house and maybe a car), and your credit rating will be stellar in short order.

[Doc Hudson]

I do use a credit card, but only for convenience and to help maintain my credit rating.

According to Dave Ramsey, that is not a good idea. And not having a balance does nothing for your credit rating anyway.

Dave Ramsey is a multi-millionaire financial adviser and real estate speculator. He proudly proclaimes that his credit rating is so low he couldn't finance a Happy Meal. He has a bankruptcy from his early days playing the real estate market and since he has paid off his debt, he has financed nothing. He is a firm believer in saving for what you want and/or need and paying cash, and he advises borrowing for nothing except a mortgage for your primary residence, everything else, pay as you go or don't go at all.

We are very nearly out of debt for everything other than our home and one small car payment. When that is paid off, we won't fall into that trap again. The old saying is that the burned child shuns the fire and brothers, we've been scorched bad enough to swear off credit cards for life.

If I didn't need any more proof that banks are nothing but legal thieves, looking at the lies, deceptions, and unfair fees banks charge on credit cards gives plenty of proof. It has gotten to the point that I don't have hard feelings against bank robbers as long as they don't hurt anyone. I consider it one thief stealing from another thief.

Fellers, tell me if I'm wrong, but once upon a time long, long ago, were there not legal limits to the interest a lending institution could charge? I seem to remember folks who charged 25% intrest getting prosecuted as loan sharks. Now, most credit cards charge interest approaching 30%, and if you have late fees or "over limit fees" added, the interest rate goes well above 30%. Yep, legalized thievery, I believe Dave Ramsey would call it a "Stupid Tax." He has also been known to say that if you are going to be stupid, you gotta be tough. I think he'd fit in here pretty well.

[Andrew]

According to Dave Ramsey, that is not a good idea. And not having a balance does nothing for your credit rating anyway.

I've been through Financial Peace University as well. I would suggest it to anyone who wants that kind of help. I know I needed it and it was a blessing. I still get surprised at the way people scoff at some of my ideas, that I have learned, to stay financially healthy. It's just not part of our cultre anymore I guess. Having said that, I am a long ways from perfect and still lack disclpline in some areas......nothing specific really.....not something I can put my finger on.....just....some things.....

[FWiedner]

I believe that, like welfare and a dependence on affirmative action, the lack of common sense, political naivete, and economic ignorance are generational afflictions. If a parent doesn't have the desire to know or find the truth, or doesn't know how, they pass that ignorance on to their children. A great many adults don't understand the function of or how to use "credit" and therefore cannot tell their children.

Credit card companies are notorious for preying upon the young, naive, and weak-willed, and it is their business practice to set young people on a path of indebtedness that takes years to get out from under. Young people, college students in particular, consider themselves to be bullet-proof AND intelligent so what could possibly go wrong? They'll be making more money than they can spend just as soon as they graduate, right?

In the effort to dump new consumers into the marketplace, publics schools deliberately teach children nothing about economics or the wisdom of budgeting funds, so it is obviously a job that lies directly in a parent's lap. Unfortunately, most parents don't have a clue and fall deep into the plastic money trap themselves.

It's easy to say DON'T SPEND MONEY YOU DON'T HAVE, but most people won't listen.

Debt is big business. Once you start trading in that stock, those folks who specialize in producing it want to keep your business for as long as possible and won't think twice about hurting you (financially) to make sure that they do.

[Joe Reilly]

Gotta remember, "they" wrote the contract.

[El Chivo]

I was always surprised at how much credit they wanted to give me, when my income was low, when I was still in school, etc.

I have often saved money by buying things on sale with the card. Paying back on time is the only way to help your credit rating.

Years ago I negotiated a 5.99% credit card and use that for any long-term purchases. I've usually had the money in the bank but didn't want to touch it, and was willing to pay the $8-9.00 per month interest.

I use a card from Amazon.com that gives me a free gift certificate a couple times a year, that's nice. I pay it off each month and it doesn't cost me a thing. I knew an eye doctor who would use a credit card to pay all his bills for his business, probably about $15,000-$20,000 per month, and he got lots of frequent flyer miles. The trick is not to overspend, not think you're going to get something for nothing.

Like any tool, it's how it's used, it can be good or bad. They are certainly convenient for shopping online.

I've always had the money in an account somewhere I could wipe out the debt if necessary.

[Gun Smith]

My daughter and son -inlaw buy EVERYTHING with a credit card. Of course they pay it off monthly. They use the perks (free flier miles) to travel on their vactions. That's what I call using the system against itself!

[dsmith512]

The Credit Card Fair Fee Act is not about the fees or percentage rates that a credit card company charges a card holder. It is about the fees a credit card company charges a retailer to process a credit card charge. For every purchase the Credit card company sticks it to the retails with a charge of 3-5% of the purchase in addition to a transaction fee. Plus the fees for the processing equipment and internet based charging is even more because the retailer does not physically have the card to swipe.

So basically the credit card company collect from both sides of a purchase. I am all for anyone making a profit but really Credit card companies play both sides against the middle and we consumers and retailers are the losers.

[Old Ironsights]

My daughter and son -inlaw buy EVERYTHING with a credit card. Of course they pay it off monthly. They use the perks (free flier miles) to travel on their vactions. That's what I call using the system against itself!

If you can do it that way it's great. The other thing to consider when goint the "no credit cards for me" route is that in some cases you CANNOT use a debit card - even if you have a buttload of money in the bank.

IIRC car rentals are a big one.

[Ysabel Kid]

My daughter and son -inlaw buy EVERYTHING with a credit card. Of course they pay it off monthly. They use the perks (free flier miles) to travel on their vactions. That's what I call using the system against itself!

If you can do it that way it's great. The other thing to consider when goint the "no credit cards for me" route is that in some cases you CANNOT use a debit card - even if you have a buttload of money in the bank.

IIRC car rentals are a big one.

Correct. Carrying around a lot of cash isn't practical for most. You just need to be self-disciplined.

No insult meant to the younger members here, but I see a definite shift, even between my siblings and myself, in the attitude about "working hard and savings" for something (my attitude) versus "wanting it all now" (my younger siblings' attitudes. It is indeed generational. Many young people leave to go out on their own and expect to live the same lifestyle and in the same conditions as the home they left - their parent's home - forgetting that their parents worked and saved for decades to get to that point.

I bought my first home less than a year out of college. It was over 50 years old, needed a ton of work, and was less than $50K. But all the sweat equity I put into it was MINE (well, our's - I got married shortly afterwards and my future wife and I bought it together - with about $97 to our names at the time). Not paying rent is one of the first and primary ways to build wealth. Saving, working hard, pouring your efforts and disposable income into your home all increase your financial stability. But, this means accepting a much lower standard of living than most are used to, and putting off instant gratification - things many young people just don't seem willing to do.

Looking back on it though only brings warm and happy memories. Building a life with the one you love makes every moment wonderful...

[Mich Hunter]

I am one of those young guys but, I LISTENED to my parents when they warned me about credit cards. I never got into too much trouble with one, but have been in the hole more than I liked. I have 2 credit cards now that I keep on hand for emergencies. I have limits up to $20,000 on both. Both have a balance of $0. Like other smart men here have said, if you can't pay cash, you probably don't need it.

Saving money is another huge problem today. Nobody saves money for their future. It seems most like in the "Now". I remember my father preaching to me about saving for my retirement when I was 12. Apparently it was a hint since I started a part time job at a Bakery the next week. I never took what he said to heart till I was 18 and had nothing. I soon learned that money did not grow on trees and joined the military. At 29 and married with two, I am doing pretty good

[Pisgah]

IMO, in an arena where there is as much competition as the credit card market there is no such thing as an "unfair" fee or interest rate. What there are is plenty of consumers too stupid/lazy to do their homework and shop around for a decent deal.

[stretch]

I don't agree with every detail of Dave Ramsey's program, but he's certainly got
the right idea. No debt is better than any debt. Michelle Singletary is a columnist
for the Washington Post with similar ideas.

My wife and I have been debt-free for about 3 years now. With two kids, we've
got all we can do to keep up WITHOUT any debt! We were able to afford to
send my 12-year-old to DC this summer for 10 days for an excursion with
People-to-People, which is a group that does leadership exercises for yong folks.
No way would we have been able to afford that with a mortgage and two car
payments.

Folks buy all sorts of little trinkets they don't need and really don't want
all that badly today because credit is so easy to get and use. My grandparents
paid cash for everything except the house. I don't think they ever had a credit
card. I have 2 cards for convenience, but they are paid in full every month. If
we don't have cash, we don't buy it.

The "traditional" American budget used to be 1/4 for housing, 1/4 for food, 1/4
to spend, and 1/4 to save. This bears thinking about. If you can achieve it, you'll
prosper. The little formula also shows how skewed our priorities are in this country,
and how badly the banks are ripping people right off with mortgages.

[Ray Newman]

"For every purchase the Credit card company sticks it to the retails with a charge of 3-5% of the purchase in addition to a transaction fee. Plus the fees for the processing equipment and internet based charging is even more because the retailer does not physically have the card to swipe.

"So basically the credit card company collect from both sides of a purchase. I am all for anyone making a profit but really Credit card companies play both sides against the middle and we consumers and retailers are the losers."
--dsmith512

Well look @ it like this: the retailer is not required to accept credit/debit cards.

But then the retailer just might loose a sale & that would hurt profits. So by accepting credit/debit cards, is not the retailer also part of the problem?? Doesn’t seem like the retailer is much of a looser when he/she makes money off of the transaction.

And speaking of the retailers role, think of all the TV & other media ads that ran during the 2007 Christmas shopping season which advertised no payments for one year or 13 + months. Well those bills will come due in December 2008 & January 2009 -- just about the same time the foolish shopper will be faced w/ bills from the 2008 Christmas shopping season. So just who is “sticking” it to whom?

"No insult meant to the younger members here, but I see a definite shift, even between my siblings and myself, in the attitude about 'working hard and savings' for something (my attitude) versus 'wanting it all now' (my younger siblings' attitudes. It is indeed generational. Many young people leave to go out on their own and expect to live the same lifestyle and in the same conditions as the home they left - their parent's home - forgetting that their parents worked and saved for decades to get to that point."
--Ysabel Kid

BINGO!

See also what Mitch hunter & FWiedner wrote about saving money telling your children about the “financial facts of life“. You two guys & Ysabel Kid are right on the money.

If you don’t like the late fees or interest payments, just pay your bill(s) on time & in full. Or cancel/close the account. But then again that might require far too much effort on the part of some.

Stretch: As for mortgages, the home owner or buyer signs it & agrees to the terms. I can remember about 10 years ago when Congress put pressure on the banks & other lending institutions to make loans & mortgages more accessible to low income, minorities, single women, etc. In many cases this was “code” for those who can’t or would barely qualify for the loan/mortgage. The veiled threat was do it or you’ll be regulated. IIRC, Former US Senator Tom “Puff“ Daschle (D-SD) claimed that "it wasn‘t fair" that only some people could have the dream of home ownership. @ the time, I knew of several people who were in the banking/mortgage broker fields. All said that it was a bubble that would eventually burst in about 5- 7 years.

Also look @ the builders & sellers of today's homes who charge -- as some claim -- exorbitant prices for these so-called “starter homes” or when buyers “move up.” The builder & construction crew want as much profit/wages as they can get, the seller wants to make as much commission as possible, the county wants as much as it can get in fees & permits, the investor wants a good return, & the original land owner or seller wants as much return as possible on the initial investment. How many people do you know who sell a house for its original selling price? All want a good return or a profit as large as possible. So who is really to blame??....

[El Chivo]

The "traditional" American budget used to be 1/4 for housing, 1/4 for food, 1/4
to spend, and 1/4 to save. This bears thinking about. If you can achieve it, you'll
prosper. The little formula also shows how skewed our priorities are in this country,
and how badly the banks are ripping people right off with mortgages.

I've always heard that ratio, but I've usually paid about half my take-home on rent. Cuts the saving part down to about 10%.

I never lived in luxury apartments, or owned a home, either. Usually a studio, occasionally a 1 bedroom.

I don't think banks are ripping people off, the percentages are low. It's real estate driving it, they raise their prices arbitrarily and everything else follows.