The poll covered the last eight months which was during the throes of the recession. The questions that were asked concerned interest rate changes, credit limit reductions or increases, and incentives offered by companies to convince consumers to close accounts. The changes made on credit cards included 42 percent of the consumers polled. Another way to state it is that 42 percent of consumers had a change made to their credit cards by the issuing company.

The most common change that occurred was an increase in the interest rates. The new Credit CARD Act set to become effective on 22-February-2010 spurred credit card companies to increase rates. The legislation limits when the credit card companies are allowed to raise interest rates though it does not place limits on the interest rates charged.

The CreditCard.com polls reported that 38 percent of credit card holders had their interest rates increased over the last 8 years. The consumer advocate organizations have been monitoring the actions of credit card companies and are appalled at the increases in rates being put in place ahead of the new legislated rules. Some have tried to get Congress to stop the lenders from making radical changes in card terms but to no avail.

Other changes that consumers experienced related to their credit card accounts include conversion from fixed interest rates to variable rates and changes in the limit amounts. A surprising result of the poll was that 30 percent of the credit cards experienced an increase in credit limits.

Americans are using credit cards less often. According to the Federal Reserve, Americans cut their credit card debt by $91 billion in 2009. With the high unemployment rates, consumer counselors have been advising households to cut back on their use of credit cards. It is tempting when money is tight to use a credit card to make purchases, but the increase in debt often comes back to haunt the household.

The question now is whether reductions in credit card use will endure as the economy improves. As consumers return to work over the coming months, the analysts will be watching the numbers closely to see if there has been a permanent change in attitudes towards debt. Americans are being encouraged to save more and use credit cards less and many hope the new lessons stick.

Ironically though, if the changes in behavior are enduring, there is a question about the influence the changes will have on the economy. The less consumers spend, the slower the economy will recover. The CreditCard.com poll surveyed 1,004 households with a margin of error that was plus or minus 3 percentage points.

The Consumers Union has expressed the opinion that the law is an important first step in establishing rules that limit the credit card company’s ability to use tricks to capture consumers in unmanageable debt. The new law addresses billing, disclosure, marketing to college students, and the infamous introductory offers that come in the mail.

There are things the new law does not address though. The credit card companies can still raise interest rates as high as they want and can add new fees too for opening, closing, or making account changes. They can still reduce account credit limits too without giving the card hold any warning.

A plethora of fees that will show up on consumer accounts are expected. In many cases the addition of new fees started months ago. The financial institutions have been crafty too. For example, Fifth Third Bank began charging $19 when a card is not used for 12 months. In other words, it is a fee for not charging. Banks are charging for printed statements, cash advances, minimum account charges, paying online and more.

The Credit CARD law clearly does not limit fees and that means the credit card companies are free to replace as much of the revenue lost through new regulations as desired with new fees. In the opinion of the Center for Responsible Lending the card issuers are able to do pretty much what they want still.

What else does the new law not do? It does not prevent credit card companies from raising interest rates on new purchases. Though interest rates cannot go up on purchases already mad, the new rates can be as high as the company wants to charge. For example, First Premier Bank offered a credit card with a 79.9 percent interest rate. You have to speculate as to the type of customer who would accept such an exorbitant rate.

The law also does not stop the credit card companies from lowering credit card balances which can lower a credit score. The Credit CARD Act does not apply to business credit cards. That means many small businesses will still face the same problems as before when working with the lenders. The law does instruct the Federal Reserve to study how businesses use credit cards.

The next step according to consumer advocates is to extend the law to include limits on fees and interest rates. Though that could happen, it probably will not happen anytime soon. The credit card companies are already expected to lose revenues during a time when the economy is struggling to recover. It is unlikely Congress will address in the near future what the Credit CARD Act does not do.

There has also been a lot of negative publicity aimed at credit card companies pre-empting the law by raising interest rates and fees. The reason for the high rate increases now is because the new law limits when and how the credit card companies can change customer interest rates and fees.

Through all of this it is easy to lose sight of the fact that consumers have a responsibility to manage their credit cards. The new law takes effect in February 2010 but customers can begin right now to manage their credit card debt. One thing that has confused many people is having their credit lines reduced even when they have an excellent payment history. This has just been one of the many consequences of the rule changes being absorbed by the credit card companies. So consumers need to understand that even in these types of situations, it is still incumbent on them to manage their debt responsibly.

Consumers can minimize the chances of having their interest rates increased or their credit limits decreased by lowering the balances on their accounts and making timely payments. And the wider the difference between credit limits and credit used, the better for the credit score.

If you want to avoid having a credit card cancelled, you need to use it periodically to keep the account active. Credit cards not used by customers have no value to the credit card business. You also have to watch out for inactivity fees that are currently being implemented in advance of the Credit Card Accountability, Responsibility and Disclosure Act.

When you get a credit card statement, it is important to read it carefully. The new law requires credit card companies to give customers and opt-out option for cards when rates are changed. Since many companies are making changes now in advance of the new CARD Act, it is important to keep a close eye on changes to your account. The types of changes that will be common include offers for over limit programs with expensive fees. The reality is the over limit programs are really not necessary if you manage your credit card usage in a responsible manner.

It is advisable for consumers to spend some time now to review their credit reports and scores. You should look at the open accounts on your credit report and decide if each account is necessary. When an account is closed, it will lower your ratio of available credit to used credit though. This is just one example of how manage a credit score.

The new Credit CARD Act is having some unintended consequences already as the credit card companies prepare to preserve their revenues and profits. Over the last ten years, consumers had become somewhat immune to credit card offers. Now it is time to actively manage the accounts, offers and terms.

Even though these settlement options have been there, many cardholders haven’t taken advantage of them. That has begun to change. As first noted in the New York Times, a growing number of consumers are looking to settle up with credit card issuers rather than defaulting on their credit card debt. What’s amazing is that the lenders themselves are often the first to offer settlement plans on the spot.

This isn’t to say that every cardholder will qualify for settlement options, but a vast majority have a better than average chance. This comes down to leniency on the part of card issuers.

These lenders understand clearly that more consumers are falling behind on payments as the national unemployment rate continues to rise. Even the figures help paint the picture in starker hues. Credit card defaults soared to record-breaking 10% in May. This meant that 10% of the outstanding balances were deemed uncollectable.

This move on the part of lenders comes in the wake of the intense legal and ethic scrutiny that has been leveled at the debt settlement industry. Regulators have accused different companies of charging exorbitant fees while failing to carry out the promises they made to client, and ultimately leaving the consumers if worse financial shape than when they came for help.

Still, cardholders will have to deal with some consequences for approaching lenders for debt settlement. Obviously, your credit score will drop. Also, any debt that has been forgiven will be considered income; thus, it is taxable.

If you are interested in credit card debt settlement, then the first step is approaching your lender. Who exactly qualifies for this aid is up to the discretion of the card company.

They can function as a high-interest “loan” to yourself that you pay off over time. They can even be used to make investments, such as starting a business. Most people nowadays have at least one card and take advantage of these things; it’s practically a requirement for participating in today’s economy.

That said, however, there are just as many people who no longer see their credit card as a tool of freedom, but rather as an oppressive yoke cast about their necks that they’re forced to labor under against their will, regretting that they ever got involved with one in the first place.

If you’re starting to identify more with the second camp than with the first, what can you do to get back on track and find yourself in a place where your credit cards are working for you and not the other way around?

There are many ways to improperly use credit cards that can allow the situation to spiral out of control very quickly. One of the main things to keep in mind is just how many cards you have.

Having one credit card is an excellent idea; if you use it properly, it can confer all the advantages enumerated above, while also allowing you to bolster your credit by making on-time monthly payments. However, recent studies show that the majority of individuals currently have as many as five or six credit card accounts open at any one time.

How does this happen?

People will come up with an amazing number of ways to justify the matter to themselves, but whatever the excuse, this is hardly ever a good idea. Limiting your credit cards to one also limits the amount of trouble you can get into.

Late payments are another thing that you should definitely be keeping in mind as you use your credit cards. It can be very tempting sometimes to let a payment slide “just once”, especially if, like many people, you’re currently hurting for money thanks to the dwindling economy. If the choice comes down to buying medicine or paying your credit card bill, most people aren’t going to think twice.

But perhaps they should. In the long term, missing credit card payment can become an all too easy habit, because, generally speaking, credit card companies don’t really give you too hard a time about it… at first. Miss one payment, and you may only get a friendly reminder.

This is because they’re waiting for you to fall further and further behind, when they can begin to really rack up the profits on fees and interest, at which point you can be sure they’ll come after you.

Avoid situations like this with responsible credit card usage at all times. Remember – your cards exist to make your life easier, so why put yourself in a situation where they’re going to do just the opposite?

After all, if you use debit, you’re reducing your cash on hand; if you use credit, you’re putting the expense off until the future, perhaps a point in the future when the economy will have improved and you’ll be in better shape? It almost seems to make sense.

However, it’s not quite that easy.

When the temptation to go with credit over debit comes up, it can almost seem too good to be true. If it *does* seem like that good of an idea to you, it’s almost certainly because you’re temporarily overlooking the critical factor of interest. When you spend money on a debit card, granted, that money is gone, and you’re not going to see it again. That can be a scary thought in a climate when people are losing their livelihoods. However, if you resort to using credit instead, you’re going to have to pay back more than you spend; in some cases, far more.

So, the hundred dollars on groceries that you “save” today by going with a credit card can easily turn into two or three hundred in just a short amount of time, especially if it’s going to be awhile before you pay off your full balance. And let’s face it: it will be awhile. If you had the money to spend on paying off your full balance soon, you’d just use debit, right? If you’ve got to use a credit card for a purchase, you have to assume you’ll be paying it back in increments and accuring interest all the while.

Some people will cite certain advantages that credit cards supposedly hold over debit cards, such as the fact that they allow you to establish a good credit rating, and occasionally offer other incentives such as cash back on purchases or frequent flyer miles. You have to ask yourself, however, whether or not these advantages really outweigh the risks that you’re taking upon your shoulders whenever you choose to use a credit card in a risky economy.

In most cases, the cash back doesn’t end up amounting to much, usually somewhere around 1% on purchases. It can almost guarantee that your interest rate is higher than that, and thus, pretty much negating any benefit you might have gained. Besides, if it really means that much to you, there are many debit and bank cards that now offer similar incentive programs. Ask your bank if you can sign up for one of them.

We understand that the temptation to resort to credit can be huge. However, think about the reason you’re considering it – you’re looking to the future, with hope that the economy will improve. Ask yourself – isn’t it better to weather the storm now, so that when that improved economy does come around again, you aren’t still stuck in the rut of paying off long overdue bills? Think ahead, and plan for the long term, especially when it comes to your credit.

While not everybody is responsible for getting involved with the mess, it has affected the entire country, and the shock waves from everything related are still rippling through the economy, causing major financial disturbances. The housing market crashed, and along with it the mortgage industry which has seen a record number of foreclosures due to delinquent and absent payments. From there, the U.S. automakers are all facing bankruptcy, and as a result they’re shutting down dozens of plants and laying off thousands of people in an attempt to cut costs. From here, people have less money to spend, due also to the higher costs of gas, food, and various commodities.

Everything combines to cause people to have to use their credit to make ends meet. Unfortunately, the banks of America have suffered the most out of this, and due to their own negligence and lack of foresight, allowed bad debts to collect on their part that nobody is paying back. As a result, people are losing out on getting loans and it’s harder than ever to secure one. With no credit backing the system and credit cards being harder to obtain, the idea of credit itself seems like a haunting concept in the minds of many people who are stuck having to face the doom and gloom of daily life in financially troubled times.

While it is a good idea to look at credit with caution, it’s not wise to dismiss it outright. It’s still essential to the economy, and as such, you should respect it. However, you should also keep in mind that you’re in control of your credit, and so you should do things in a way that benefits it while minimizing the expenses you accrue on a monthly basis. If you keep your costs at a minimum while paying off your debts on time, your credit will naturally improve. If you let everything go and approach your personal finances pellmell, then you’ll get nowhere and your credit may just suffer as a result.

It’s tough to build credit these days, and most people are suffering from bad credit already due to recent events. However, credit cards are still one of the strongest options for slowly building credit, but they must be respected. Being powerful weapons of finance, they can either slay your insecurities and establish a strong financial backbone that will get you through anything, or destroy your reputation for handling your money in a safe and responsible manner.

You want to take advantage of what credit cards offer you while avoiding the pitfalls that come with the possession of one. Keep in mind that it is a loan you must pay back on time and in full every month, and you’ll be well on your way towards a slow but very steady strong financial foundation.

Even with the way the economy has been sluggish recently, having a credit card is an important tool in making financial choices from a day to day basis. They enable you to quickly get what you need by taking out a loan against the value limit of the card, developing a balance. This balance is what you reduce when you make your monthly payments. It’s ideal to cover what you owe in full, so that you not only cover your expenses and prevent debt from accruing, but also maximize the benefits of your credit card in regards to building credit.

Making your credit card count means doing more than just making your payments on time and in full, however. You want to obtain a card that meets your needs and gives you fair and respectable terms and conditions. If you already possess a card that isn’t optimal, you should reevaluate it and either establish new terms or find another one that meets your needs.

One of the first things you should consider with a card is the annual fees that may apply. Most people dislike annual fees simply because they frown upon the idea of paying a fee just to possess a card. However, annual fees often give you cost-saving benefits that apply to other aspects of the card, such as the possibility of lower interest rates that are fixed.

Something that matters to every credit card holder are the balance transfer features. This involves the rate of percentage that applies to purchases, and can go to one of two extremes. You can have either a card with a low balance transfer APR or one that comes with a higher APR that involves no transfer fees. Neither of these choices are better than the other, and are equally popular among cardholders. It’s simply a matter of choosing the terms that are right for you.

Another thing that shouldn’t be ignored are introductory offers. Card issuers like to present benefits and bonuses upon signing up that are very quite attractive. Several of the major card companies offer cards that come with 0% APR for roughly the first year or so. While these benefits may seem great at first, you should still consider what the card offers you after the sign-on bonuses expire. In many cases, you might end up with a card that is unfavorable to your situation and financial needs.

Having a credit card is one of the greatest tools you can possess this day and age. Just like any other tool, they come with the responsibility of having to be utilized wisely. More than that, however, you want to make certain that the tool you choose is appropriate for the task, which in this case is your personal finances.

Economic experts know, however, that they don’t always benefit the people who end up with them, but generally speaking, if a credit card is used right, it can indeed improve your credit score considerably. While the conditions of a card vary between card companies, you can reasonably expect a provider to operate by forwarding your spending and payment habits to credit bureaus so that your financial habits with a card are recorded on your credit.

That idea may seem scary to some people, but that’s the way credit cards work. With the right behavior and good habits, rather than recoil in apprehension at the thought of such things, you can instead relish the satisfaction of knowing that you’re doing a good job of keeping your financial reputation on the path of prosperity.

It takes hard work, diligence, and prudence, however. A credit card won’t improve your credit score overnight. Instead, what you need to do is make certain that you think in terms of the future, pay your balance on time and in full every month, keep conscious of your spending limits, and to monitor your transactions on a regular basis. These things sound simple and obvious, but a lot of people tend to get lazy or careless, and is it in the details where they find their mistakes.

Another thing that should be considered is the terms and conditions of your card. Scrutinize the policy that is presented to you, and determine that you’re getting a deal that is fair and advantageous to you and your needs. It can’t be stressed enough that in order for a card to benefit you, it should come equipped naturally with terms that work in your favor.

Making purchases with a credit card is something that doesn’t make buying items cheaper for you. In fact, it can be more expensive, because of the interest rates that apply to the amount that you owe on a card or the payments you make. Not only are cards capable of tricking you into thinking that you’re capable of handling more than what you can afford, they can also come with hidden fees and penalties for not managing your bills properly and on time.

Even then, they can also confound your efforts at making payments by tricky policies which come into effect just for having the card, such as annual payments for “service”, among other vague and subtle things.

Cards not only encourage you to spend what you don’t carry wherever you go, the companies themselves can back the advertising that assaults you. Card companies often send their consumers all sorts of flyers and deals in the mail that give those individuals rewards and privileges that depend on spending more. It is often these things that hamper their ability to save their money.

Having a credit card is a very challenging task, but one that comes with a potential for huge rewards. If you consider exactly what you have and how to manage it without inciting the wrath of your card company, you can gradually improve your credit score over a period of time, which is one of the best ways available to do so.