Angry consumers cancel their cards

By PHIL MULKINS World Action Line Editor - 10/25/2009


Dear Action Line: I wonder how many people are mad at these banks after they spent 95 years convincing us to use their credit cards and now treat us like criminals. Almost everyone I know is burned up over this and plans to pay off their cards and use only cash in the future. — L.R., Tulsa.

A Consumer Reports poll, featured in its November issue now on news stands, says 45 percent of consumers say they are paying less with credit than a year ago.

One-third have paid off and closed accounts since January 2008, and half of those canceling did so in retaliation to issuers' policy changes: cutting limits, hiking rates or imposing fees.

Mostly mad as heck: Credit card holders are angry, and 21 percent say they were treated unfairly by card companies, says the nationally representative survey of 1,211 card users conducted in July. Scores of letters and e-mails to Consumer Reports indicate the same sentiment. Only 41 percent of respondents said they were satisfied with their issuer, making credit cards one of the lowest-rated services Consumer Reports covers.

Three camps: The survey also found 45 percent of respondents say they are charging less, 43 percent say they are spending about the same and only 11 percent are charging more than they did a year ago. It showed credit card users occupy one of three camps: 54 percent keep balances paid off but use them for convenience and rewards, 33 percent run balances of up to $10,000 and 13 percent average $17,366 in debt to their cards.

Credit-union cards: Joining a group can make consumers eligible for some good credit-union cards. Employers often provide access to employee credit unions.

Association cards: USAA offers rewards cards with interest rates at 7.75 percent for current and retired military personnel and their families. The NEA Platinum Plus card, available to teachers who are members of the National Education Association, offers a 6.24 percent APR.

Balance-transfer cards: Consider these if you're currently paying high rates on existing balances. American Express Clear, PenFed Visa Platinum and People's United Bank Platinum MasterCard have APRs in the 12.24 percent to 13.99 percent variable range.

Low-rate cards: Good for people who regularly carry balances are Iberiabank Visa Classic and Simmons First Visa Platinum in the 7.25 percent variable to 15.25 percent range.

Cash-back cards: Best for cardholders who pay off their balances in full each month are American Express Blue Cash, Capital One No Hassle Cash Rewards, Fidelity Rewards American Express, Schwab Invest First Visa For more information on these cards or how to find the best card for your needs checkout.

Find good cards: Check for deals offered through or monitored by LowCards.com, CardRatings.com, FatWallet.com and BankRate.com.



Submit Action Line questions by calling 699-8888 or by e-mailing phil.mulkins@TulsaWorld.com or by mailing it to Tulsa World Action Line, PO Box 1770, Tulsa OK 74102-1770.


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Tulsa World Reader Comments
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Daven, Tulsa (10/26/2009 8:56:24 AM)
I use my credit cards for mainly online shopping. But I pay them off in the same month if not the next month. My rule of thumb is that if I cant pay it off in two months then I can wait unless its an ER situation like a new water heater something like that. I also find that giving a credit card to my daughter for her back to school shopping, xmas shopping, etc is much better then cash. No worring about her losing it or getting ripped off. Personally, I use my bank card for the majority of my purchases. Rarely ever carry cash. I find it easier to track my purchases that way.

Few Clothes, America (10/25/2009 4:48:03 PM)
They only have themselves to blame. A person should not buy every thing they want. I have been like cybercitizen and have paid my credit cards in full for years. With the exception of a house, if you can't pay it off within a year, you don't need it.

Few Clothes, America (10/26/2009 10:38:21 AM)
GretaSue, I think that is a wise decision. The only time I use mine is to reserve a hotel, then I use my debit card to pay for it.

BillD, Tulsa (10/26/2009 12:32:42 AM)
Credit cards are great consumer tools, I charge everything I can on them. They are great to: Avoid carrying cash, pay cash back, provide insurance on rental cars, provide recourse for bad purchases, automatically do record keeping on purchases, plus more. In 30 years, I have paid zero interest and collected probably $2,000. in credits. Great, Great financial tool. Debt cards on the other hand are not advantageous.

cybercitizen, Bville (10/25/2009 10:15:42 AM)
I now pay my credit card off in full every single month like it was a religion. The credit companies are abusive--they take whatever they can get. This definitely helps me to sleep better. What helps is calling all the catalog people and telling them to take me off their lists. I don't have the space anyway.

shaw411, Scottsdale, AZ (10/26/2009 10:03:13 AM)
That's the deal....you pay off the balances now and the credit card companies do not make any interest off of the consumers. The rules seemed to have changed now. Now it might be better to have a balance rather none at all. First they will raise your rates and lower your limits then cancel when you no longer maintain a balance....does not seem right but that looks like that's the way it is headed.

steffy, TinyTown (10/26/2009 11:32:55 AM)
The problem with getting rid of your credit cards is that your credit score will be lowered. I plan on buying a house soon and need my score to be as high as possible so I can get a better rate. The card companies have us right where we will do them the most good. I cannot comment any further without using offensive language.

GretaSue, (10/26/2009 12:10:07 AM)
After working hard for years to get low interest cards, they have raised my rates twice in the last 4 months, from 9.9% to 13.9%... I am paying it off next month, and will be a long time before it gets used again.. If I can't pay cash, I don't need it.

JR, (10/25/2009 9:24:02 AM)
Good job, Phil..

bholly, (10/25/2009 8:12:58 AM)
YOU DON'T NEED CREDIT CARDS TO LIVE ON. PAY CASH , USE DEBIT CARDS, OR DO WITHOUT.



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