Beat Credit Card Companies at Their Own Game!
Have you ever wondered how much money a credit card company makes? Have you ever wondered how much of that comes from late fees? Everyone has and if you haven't you should because most likely you own a credit card, which means that these late fees has or could directly affect you.
As you have probably taken notice, credit card late fees are on the rise and have been so for awhile. There is enormous competitive pressure on credit-card interest rates and annual fees, and this has given way to a fee frenzy. For credit card issuers, late fees now represent their third largest revenue stream, (interest revenues and merchant fees rank first and second, respectively). In essence, those who pay late are now covering the costs for those credit card users who do not carry a revolving balance and those who file for bankruptcy.
So how much are credit card companies making from issuing late fees? Over the years we have watched the number of late fees charged to consumers jump to record-high levels. Late fees can range from $10 to as much as $40. The average late fee more than doubled since 1996 from $13.28 to $29.84. In fact, many major card issuers are now charging a $35 late fee. Let's assume that 100,000 people made late payments for a particular month and they were charged a late fee of $30 for doing so. This would add up to $3 million in revenue. As you can see, credit card companies are making a lot of money off of card holders and there is no slow down in sight regarding the increase in late fees.
Credit card companies are making a killing off the late fees they issue to their customers and they don't mind doing it because their ultimate goal is to make money. They are like any other for-profit business in that they sell a product or service for revenue. In the case of credit card companies, the product happens to be credit. These companies aren't just some "thing" sucking up as much money as they can. These "things" are run by man. And wherever man is involved, greed also becomes involved. These people are just like you and me. They may have a family to support, bills to pay, etc. Most people don't work just for the pure enjoyment, but for money, a source of income. And the more income we achieve the easier and better our lives become, supposedly.
Some of you may be asking, "So what do we do about the late fees?" Well there's an article that I wrote awhile back that you may be interested in. You can find this article at http://www.nextmonthonline.com/WhitePapers/Article1.aspx . It addresses several methods and tips to avoid having to pay a late fee. One method in particular that I would like to address further in this article is the Skip-a-Payment technique. If you happen to know that you can't pay your credit card bill for a particular month just skip it. Next Month Online is an independent company from credit card issuers. They allow their visitors to skip a payment for a nominal fee. This fee is generally 70% less than your typical late fee. You will accrue no late fee and no bad mark on your credit report. Credit unions often offer this type of service for loans or mortgages, but first you have to fill out an application and then you need to qualify. With Next Month Online, there is no application to fill out and everyone qualifies as long as they have a credit card. Credit card companies are not very happy with Next Month Online because they are losing money every time someone uses the Skip a Payment service. This is by far the best service you can use if you know you will be late because you save a lot of money and avoid all the hassles that come with bad credit.
Credit card companies are not backing down from increasing fees. They, for some reason, do not see us as people who make mistakes once in awhile or people with other priorities in our lives. They want their money and they want it now! This is the reason you should not back down either. Hit them where it hurts, their pocketbooks. If you know you will be late for a particular month, just use a skip a payment service because the credit card companies will no longer be taking money from you, you will be taking money from them.
About the Author Daryl Flagg is the founder and CEO of Next Month Online. Next Month Online is a service that allows its visitors to skip credit card payments. They can be found at http://www.NextMonthOnline.com. Sign up for free!
MORE RESOURCES:
 Washington Times | US Consumer Credit Increases $14.3 Billion in June (Update2) Bloomberg - Consumer credit rose by $14.3 billion, the most since November, to $2.59 trillion, the Federal Reserve said today in Washington. In May, credit rose by $8.1 ... US June consumer credit rises by $14.3 bln, 6.7 pct annual growth rate Consumers jack up borrowing in June Ahead of the Bell: Consumer Credit |
 Voice of America | US Government charges 11 in massive credit card fraud case Heise Online, Germany - The US government has charged 11 people with stealing tens of millions of credit and debit card details as part of an operation that targeted numerous ... Video: Feds Charge 11 in Massive Retail Hacking Case Credit cards: US authorities charge 11 in global identity theft racket Gang charged for theft of 41 million credit card numbers |
Credit Suisse Sued Over Auction-Rate Securities (Update3) Bloomberg - 7 (Bloomberg) -- Credit Suisse Group, Switzerland's second-biggest bank, was sued by Swiss semiconductor company STMicroelectronics NV for allegedly placing ... STMicro sues Credit Suisse over auction-rate debt |
 Washington Post | Here comes the credit crackdown Independent, UK - One year into the credit crisis, regulators are hard at work on new laws they hope will prevent history repeating itself. Leading investment banks fear a ... Industry group to address credit risk Panel Calls for New Risk Standards Banking Group Proposes Wide Range of Reforms |
 AFP | Barclays' Profits Hit by Credit Crunch BusinessWeek - by Kerry Capell The credit crunch continues to take its toll on British banks. On Aug. 7, Barclays (BCS) revealed its first-half pretax profits fell by ... Barclays: credit and credibility Income at Barclays declines less than analysts expected Barclays Profit Falls 34% on Securities Writedowns (Update2) |
Consumer credit jumps at fastest rate in 7 months MarketWatch - Consumer credit, excluding mortgage debt, expanded at a 6.7% annual rate in June after rising at a 3.8% pace in May. It was the biggest increase since the ... Credit-card Companies Making It Harder To Say 'charge It' CreditCards.com: Weekly Credit Card Rate Report Reform credit card industry |
 Earthtimes (press release) | Consumer credit rose $14.33 bln in June Reuters - WASHINGTON (Reuters) - US consumer credit expanded at the fastest rate in seven months in June as Americans turned to credit cards and consumer loans to ... Consumer credit rose $14.33 billion in June |
BC-based Lake View Credit Union Selects Open Solutions' Core Platform MarketWatch - Lake View Credit Union has assets of more than $200CDN million and serves 15500 members through three branches. This year, the credit union celebrated its ... |
Bridge Finance Group Provides a $4.0 Million Revolving Line of ... MarketWatch - CHICAGO, Aug 07, 2008 /PRNewswire via COMTEX/ -- Bridge Finance Group announced the completion of a revolving line of credit to Access Distribution, ... |
Regulators orders CNG to credit customers Hartford Courant, United States - Commissioners of the state Department of Public Utility Control voted unanimously to require the utility to keep the credits in place on customers' monthly ... Conn. regulators may order CNG to credit customers Regulators orders CNG to credit customers Regulators may order CNG to credit customers |
What To Look For In A Credit Card
When you are deciding what type of credit card to get it is important to compare credit cards to each other and find the best deal for you. There are a variety of different credit cards available, from low interest cards, cash back cards and even reward credit cards, it's hard to decide what exactly the best credit cards are.
Credit Card Balance Transfers Can Help You Stop Putting Money Down The Drain
As you probably know, interest rates are at all time low right now and if you aren't getting the best deal from your credit card company then they owe it to you to either lower your rate, or you owe it to yourself to find a better deal. You see, credit card companies need your business in order to succeed and if you refuse to pay a penny more than you have to then you'll be doing yourself and others a big favour indeed.
Balance Transfers Can Help You Stop Putting Money Down The Drain!
As you probably know, interest rates are at all time low right now and if you aren't getting the best deal from your credit card company then they owe it to you to either lower your rate, or you owe it to yourself to find a better deal. You see, credit card companies need your business in order to succeed and if you refuse to pay a penny more than you have to then you'll be doing yourself and others a big favour indeed.
Fixing A Credit Report
Fixing a credit report starts with seeing what's on it. You may get access for free online.
Everything You Always Wanted To Know About Your Credit Report
Your credit report is a very powerful report that essential controls what you can and cannot do in your life. Unfortunately many people aren't aware of what a credit report actually is and what information is contained on the report.
Debit Card vs. Credit Card, What Are The Differences ?
Ah, the "good old days". If you are a baby boomer, like me, then you probably remember how important it was to rush to the bank on payday.
How To Get a Low Interest Credit Card
Consumers often have the first credit card that they ever applied for, never really analizing how the interest rate affects their payments, but many other options exist and can help consumers decrease their payments and achieve financial stability.With interest rates on some credit cards rising to over 23%, even low balance credit card debt can be crippling.
3 Ways to Improve Your Credit Score by 50 Points In Less Than 30 Days
In Less Than 30 Days. "What can you do to increase that set of three numbers on your credit report that can be so important with your financing?" I came across this question as I was surfing discussion groups the other day.
Which Business Credit Cards with Reward are the Best?
Thinking of applying for a credit card with a reward program to help you and your business? Here is a brief guide to some of the best programs on the internet.The Platinum Business Credit Card with rewards from American Express is a great offer.
Learn How to Improve Your Credit Score
Having a damaging credit record can hurt you in many ways. It may prohibit you from making an important purchase such as a home, car, computer or vacation.
SuperCharged Secret 3, Credit Card Utopia
TURBO-CHARGED KILLER RATE SAVING INFORMATION!Let's just take a brief moment to recap:If you've been following along on this journey with me, learning the 5 Super-Charged secrets to Credit Card Utopia, then you now know 2 very important things:You now know how to take advantage of zero to low interest credit card offers.You now know that there is safety in numbers, and you know the magic "Who's Who" of the major credit card companies.
Five Credit Card Billing Problems and How to Fix Them
It goes without saying that your first and best defense against paying fraudulent or unfair charges on your credit card is knowing what your bill says! When you receive your credit card statement each month, sit down with it and check each item to make sure that you actually DID purchase it. If you do run into inaccuracies or problems, there are procedures to follow to report and deal with the charges.
Credit Repair Companies and Credit Counseling
Let's be crystal clear, right up front. Paying someone to "fix" your credit is a waste of your time and money, since the negative issues that are temporarily removed from your file will only reappear again in a couple of months.
14 Common Credit Mistakes
Establishing credit and wisely managing your credit becomes easier when you know how. You'll feel empowered by taking knowledgeable steps towards good credit, and you'll be on your way to purchasing real estate and greater financial freedom.
Which Credit Bureau Should I Use To Check My Credit Report?
There are three main credit bureaus in the United States; Equifax, Experian and Trans Union. Each bureau collects your personal and financial information which is then sold to lenders such as banks, credit unions, credit card companies, mortgage and auto loan lenders.
Do You Want to Get a New Credit Card at a Great Rate?
1) Do your homework. Applying for and getting approved for a credit card is nothing more than legwork.
Getting Married? What Are The Finance and Credit Implications?
There is a big difference between looking after your own finances while living alone, or with parents, and living with a partner. The transition can be very difficult, especially if both partners are strongly independent, or one partner is financially weak and the other strong.
Credit Cards and How To Choose Them:
It may seem like a simple question but its important to take into account a few factors when choosing your credit card. If you are in the enviable position of being able to pay off your card every month then you are amongst the few.
ChexSystems: Who They Are and How it Affects You
ChexSystems is a company that maintains a subscriber membership service used in the banking industry. The members consist mainly of Banks, and Credit Unions, but can include other types of Financial Institutions.
Dont Dig Your Own Pit
If you want to enjoy your life out of spending, enjoy if you have your own resources and money.But don't enjoy your life by becoming a debtor to somebody.