Choosing the Best Credit Card

There are a lot of different credit cards, but none of them are a one-size-fits-all type of credit card. Since every card is different, it’s important that you choose the one that’s best for you. Whenever you’re on the market for a new credit card, you should look at several different ones and compare the features. Decide what’s most important to you and use that criteria to choose a credit card.
Type of Credit Card

There’s more than one type of credit card. The one you apply for depends on how you plan to use it. You can choose a standard credit card that allows you to have a revolving balance and use wherever credit cards are accepted. Premium credit cards have perks like higher credit limits, cash back rewards, and travel incentives, but require a higher credit score. Then, there are limited purpose credit cards that you can only use in certain places. An example of a limited purpose credit card is a store-branded credit card that you can only use in that specific store.
Interest Rate

Your credit card interest rate influences the amount you pay for carrying a balance from month to month. If you pay your balance in full each month, having a low interest rate won’t be that important. On the other hand, if you don’t plan to pay off your balance, then you should look for a credit card with a low interest rate. This will allow you to pay a lower price for finance charges that are applied to your balances.
Credit Card Fees

Before you apply for a credit card, make sure you know which fees could be applied and the situations in which they’ll be applied. Some credit cards only charge fees as a penalty when you’re late on a payment or go over your limit. Other credit cards have annual fees that are charged yearly just for having the card. Ideally, you want a credit card that doesn’t charge any fees at all. Nearly all rewards and premium credit cards come with an annual fee.
Credit Limit

Your credit limit is the maximum amount you can charge on your card without penalty. The amount of credit limit you need depends on the amount of purchases you plan to make on your credit card. Some people use their credit cards for frequent travel or business expenses, so a high credit limit is needed. If you’ll only use your credit card for shopping and other small purchases, then, you won’t need a high credit limit. Your credit history will influence your credit limit – a better credit history will allow you to get a higher credit limit.
Rewards Credit Cards

A rewards credit card gives you some type of incentive for using your credit card. It might be cash back, points you can redeem, or travel rewards. When you’re looking for a rewards card, consider any limits or expirations on the rewards. This will impact the number of rewards you can accumulate and the amount of time you can use them. You should also think about your spending habits. If you don’t use your credit card often, you won’t have the opportunity to earn many rewards which could make the rewards card unbeneficial.
How to Choose Your Credit Card

Look at all the features of the credit card: type of card, fees, interest rate, credit limit, and rewards. Evaluate each credit card you’re considering based on the needs you have. Then, choose the credit card that will best fit your needs.

Five Things to Consider When Choosing a Bank

A recent survey by RLC, USA shows that the top 10 reasons consumers choose banks. Here are the top 5: location, previous relationship with the bank, reputation of the bank, easy application process, and recommendations from friend. Your money is too important to make a haphazard decision about your bank, so as you wonder how to choose a bank, here are some other things you should consider.
Is your money secure?

If the bank fails, you want to be sure you’ll get your money back. The FDIC (Federal Deposit Insurance Corporation) insures accounts at many banks for up to $250,000. Credit unions aren’t covered by the FDIC, but by a similar organization, the National Credit Union Association. Before you decide on a bank, make sure it’s covered by one of those two agencies. Otherwise, you risk losing your money if the bank files bankruptcy.
How much does the account cost?

There are many banks that offer free bank accounts, but will eat you alive with overdraft, stop-payment, and returned-deposit fees. Don’t be surprised by fees to talk to a bank teller, to check your balance, or to get a money-order or cashier’s check. You should also be aware of ATM fees that may be charged when you use another bank’s ATMs. Look for the bank that’s going to charge you the least amount of money for the services you use.
Online bill paying options?

Long gone are the days when you sat down with a checkbook, a stack of envelopes, and a book of stamps and paid your bills. These days it’s a lot faster, cheaper, and more convenient to pay your bills online. As you shop for a bank, check the availability and cost of online bill paying. There are quite a few banks that offer this benefit for free so if you have to pay, make sure the bank makes up for the cost with other perks.
Is the bank accessible enough to meet your needs?

Online banks have increased in popularity, but if you need a bank you can walk into, an online bank won’t serve your purposes. Think about how often you’ll actually need to visit the bank and evaluate each bank based on that need. If you have a busy work schedule that won’t allow you to visit the bank during normal business hours, look for a bank with late evening and weekend hours. Also consider the bank’s physical location in relation to where you live or work. If you’re going to visit the bank over the weekend, don’t pick a bank that’s near your job (if your job is on the other side of town).
Are there minimum balance or minimum deposit requirements?

Some banks require you to deposit or maintain a certain account balance, or both, to bank with them. Whether you choose a bank like this depends on whether you can afford to maintain the minimum balance. You can often open an account without having the minimum balance, but you’ll be charged a fee each period, monthly or quarterly depending on the bank, that your balance falls below the minimum.

Take your time choosing a bank and ask your friends and family for recommendations. Some banks charge a fee for closing your account within a certain period of time, so try to get it right the first time.

Payday Loans Boom During Bust Economy

No matter where you look, whether it’s on Michigan Avenue in Chicago or High Street in Cardiff, you can hardly go for more than a mile without finding a payday loan business, or at least an advertisement for one. Payday lenders about, fighting one another for a coveted and small, yet growing, marketplace.

Payday loans provide a relatively small amount of cash to a borrower with the idea that, on their next payday, they’ll pay back the loan. Unfortunately, in a down economy, more and more people find themselves in need of this kind of a service.

The Wrong Kind of Opportunities

In many ways, the success story of the payday loan industry is the same story as the credit crunch and the recession. The global crisis in banking slowed credit to a crawl. Funding for lenders and for banks dried up, and consumers found themselves without access to cash. Because of that, the number of payday lenders has risen sharply.

Payday lenders rely on quick returns for short term loans of small amounts. In some cases, existing lenders are adding payday loan services, while in other situations related businesses like pawn shops are entering into the fray.

In addition, payday loans are now available online. Many lenders offer online payday loans. Of course, whether or not you can actually use one of these online services actually depends on the specific lending laws in your home state.

A Matter of APR

The controversy surrounding payday loans has to do with the associated fees. In California, for example, you can borrow $100 with a maximum fee of $15 for the loan. When that’s paid off in two weeks, you’re all done. If you don’t pay it off and have to renew, you pay another $15. Over the course of a year, this adds up to an Annual Percentage Rate (APR) in the hundreds of percents.

Advocates of payday loans argue that APR is irrelevant. That’s true, if the loan is paid off. More than half of payday loans, however, are renewed for at least one more pay period. That’s when consumers can find themselves stuck in a vicious cycle of fees.

Real Solutions

Some politicians have argued that the best way to fix the payday loan problem is with regulations. In fact, several states have capped APR rates for loans. Still, the best way to put payday loan businesses out of commission is to get the economy going again, putting people back to work and into a position where they no longer need payday loans.

No Banks for the Poor

Economic times are tough, and people all across the economic spectrum are finding themselves facing new difficulties. More than one million households in the United States lost access to basic banking needs in the last year, according to a recent report by bank regulators. This number adds to the already 30 million households in the U.S. that already don’t have access to banking services, or who have little access.

Those figures represent the number of households that don’t have bank accounts altogether, or that regularly use other services as an alternative to banks. Some of the services include payday loans and check cashing services. All told, more than 25 percent of households are affected by this phenomenon. Among the hardest hit households are those who are poor, members of a minority, or immigrant families.

Access to a basic bank account is an important component of financial stability and security. A bank account lets a financially vulnerable family be able to save up for emergencies, as well as take out loans on terms that they can afford.

Unbanked and Underbanked

The FDIC classifies these households into two different groups. The first group is known as “unbanked.” Unbanked households are households that don’t have a checking or a savings account for anyone living in the house.

Underbanked households are a step up, but not too far. Underbanked households are those that may have a bank account but that regularly use more expensive forms of credit, such as check cashing services, pawn shops or payday loans.

While underbanked families are in a little bit better position than unbanked ones, there is concern that these families, too, are relying on those more expensive forms of credit. Accordingly, there is a move at the FDIC to encourage banks to open up their services to these kinds of customers.

How Income Factors In

Native American, Hispanic and black families are more likely than whites to fall into one of these two categories. In addition, approximately 71 percent of unbanked households bring in a total of under $30,000 per year. This is a staggering figure, and demonstrates that there are just too few services in the traditional banking area that are available to poorer households.

Payday loans are a viable option for these folks. Payday loans provide instant access to funds for basic need