Credit Card Banks really are Out to Get You

 

Their objective is to make as much money off you as they possibly can legally. It isn’t your imagination and you aren’t being cynical. They are out to get you and its getting worse by the day.

 

In 1978 there were fifty credit card issuing companies that accounted for 50% of the credit card market. Today there are only four companies that control 65% of the same market. Those four are American Express, Bank of America, Citigroup, and JP Morgan Chase. MBNA was the fifth but it has just been gobbled up by Bank of America. Less competition is never good news for consumers.

 

Already these giants sign you up for card with a 0% introductory offer and then that rate goes up quickly and steeply. In that itty-bitty fine print you didn’t read it says that the credit card company can do that with only a 15day notice. The period between a purchase and the time your interest starts is no longer 30 days either.

 

It’s been shrinking at an alarming rate. The fees you are charged for paying the bill late or going over your credit limit have exploded. The average penalty rate is around 24% but some are as high as 35%. Yes, the lack of any serious competition between credit card companies is hurting all of us.

 

What is a consumer to do? We are a nation addicted to plastic spending. When we make a purchase we just automatically reach for a credit card to pay for it. We use them to buy groceries, pick up our laundry and buy a hamburger. We need to break this bad habit, over-come this addiction and start using our credit cards wisely.

 

Suggestion: cash a check at the bank and pay cash for everyday purchases. Use your credit cards only when necessary and avoid paying high interest and fees.