Here’s how to avoid credit card fees


Source: Here’s how to avoid credit card fees,

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Most people who have credit cards pay fees. While a few credit card companies say they offer “no-fee” cards to their customers, many cardholders who fail to read the fine print are stuck with hundreds — if not thousands — in fees each year anyway. And since a lot of people just pay the bottom-line balance without examining their statements closely, they’re likely to be unaware of just how much those fees cost them.

Most people who have credit cards pay fees. While a few credit card companies say they offer “no-fee” cards to their customers, many cardholders who fail to read the fine print are stuck with hundreds — if not thousands — in fees each year anyway. And since a lot of people just pay the bottom-line balance without examining their statements closely, they’re likely to be unaware of just how much those fees cost them.

Planning to use your card while traveling abroad? It can cost you up to 3 percent of your purchase, meaning that $1,000 shopping spree in Paris would cost you up to $30 in fees. Getting a cash advance? While it might seem like an easy way to take care of unexpected needs, you could pay as much as 4.5 percent for that privilege (not to mention high interest rates on that money). Add on annual fees, late and overlimit charges paid routinely by many customers, and many people soon find they’re bailing water on a sinking boat.

But a new study from finds many cardholders could avoid paying those expensive fees if they just ask. It turns out that credit card issuers find themselves in a highly competitive environment these days, making it more important to try to retain their customers. You could make that work for you, because they’re often willing to waive fees upon request.

“I was surprised at the level of success, especially when it comes to asking for an annual fee waiver,” says Alex Johnson, senior marketing manager at FICO, creator of the widely used credit scoring system. “The takeaway is that you should always ask. The worst that can happen is that they’ll say no. But the data show there’s a pretty good chance they’ll say ‘yes.’”

In the study, fewer than one in four cardholders (among the 952 surveyed) reported they had actually ever asked for fees to be waived. But among those who requested late fees be waived, nearly nine out of 10 reported success. And it doesn’t just work for fees; it can also help lower your interest rate; almost 70 percent of people who requested a lower interest rate got one.

While credit card companies spend a lot on advertising to tout their rewards programs (such as airline mileage and cash-back rewards), a lot of them charge a hefty annual fee for participating. Savvy cardholders can often get their rewards-program fees lowered or eliminated, though, if they call and ask. But only a paltry 11 percent of cardholders even asked.

“People have far more power with their credit card company than they realize. Competition among card issuers is incredibly high these days and customer retention is a priority,” said Matt Schulz,’s senior industry analyst. “Don’t be afraid to ask for fees to be waived or higher credit limits because, quite often, you’ll actually get it.”

Policies vary by company, and most of the big banks issuing cards have complicated algorithms that help determine whether the customer service rep can help you when you call. Many companies (such as Discover) will routinely waive the first late fees, and possibly more, if you request it.

With these rates of success, you’d think customers would be catching on. Interestingly, though, noted the percentage of people making requests has barely changed from the last two surveys in 2014 and 2016. Many people are unaware they can make such requests, and others get stymied by long hold times or find it difficult to deal with customer service reps. Whatever their reasons, they’re often leaving good money on the table. But with a little patience and a plan, many customers find their credit-card companies might be willing to make a deal. It’s a call worth making.

Be wary of payday loans online

via Be wary of payday loans online,


PDF: online-payday-loans

The online loan industry is booming, and with it, the potential for fraud. Every day, cash-strapped Americans fill out loan applications from ads they see on websites, social media and emails. While some of these companies are really offering loan services or connecting borrowers with real loans, many others are just a way for scammers to make a quick buck.

Some consumers who thought they were applying for payday loans online got a nasty surprise a couple of years ago when their information was allegedly sold to scammers who cleaned out their bank accounts and maxed out their credit cards without their consent. The Federal Trade Commission announced last week that they’d closed down one such operation.

The FTC reports that it has charged one defendant, Jason A. Kotzker, and co-defendants with taking the information from consumers (which was supposed to have been sent to payday lenders) and instead passing it to companies like Ideal Financial Solutions, which then “raided consumers’ accounts for at least $7.1 million.” Then, the agency alleges, Kotzker and fellow defendants helped Ideal Financial hide the fraud from banks.

This isn’t the first time the feds have shut down such “data broker” operations, which target consumers seeking online payday loans. Instead of offering them the loans they sought, these operations have often signed consumers up for “membership programs” which are nearly impossible to stop. Such scams are plentiful and lucrative for their operators and won’t stop anytime soon.

If you’re looking for a loan online, you need to be careful. Many legitimate-looking sites are just fronts, designed to reassure you that you’re dealing with a legitimate company. The FTC has some good advice to avoid becoming a victim. Here are a few suggestions, from the FTC and other sources:

  • Keep a close watch on your information. Merely filling out the fields on an online application — whether or not you hit the “submit” button — can be dangerous. Many scam sites use keylogging, software that tracks and records your keystrokes.
  • Read the fine print. If any part of the application or fine print is hard to read or decipher, don’t follow through.
  • Review your bank accounts for unauthorized charges. Scammers can hit their victims pretty quickly online, so it’s important to review your bank statements thoroughly, or (better yet) track your bank accounts daily through the bank’s website or app. This will let you know if anything’s fishy so you can report it.
  • Beware of “no-credit-check” loans. Most lenders are going to perform a credit check to determine your creditworthiness before offering you a loan, even if it’s just an employment verification. If there is no evidence the lender has checked into your credit or background, it could be a red flag.
  • Beware of unsolicited offers. Often, tracking software can help flag web users who look online for loans. This can lead to pop-up ads and unsolicited loan offers. Disreputable companies often use these tactics to find victims.

Consumers to get free credit reports

via Consumers to get free credit reports

The nation’s three largest credit bureaus will be paying more than $7.1 million to the state of Mississippi to settle charges they failed to verify information about consumer debts that appeared on consumers’ credit reports and allowed erroneous information to remain on credit reports, damaging the credit prospects of numerous consumers.

Mississippi Attorney General Jim Hood announced the settlement, in which Equifax, TransUnion and Experian have agreed to overhaul their business practices and offer Mississippians unlimited access to free credit reports over the next three years. The settlement follows an investigation begun in 2013.

The three agencies will pay the state a total of $7.175 million. Starting in November, Mississippi residents will be eligible to receive unlimited free credit reports for three years and one free FICO credit score every year for three years, in addition to other benefits (a complete list is available at


“There are few documents more important than credit reports to borrowers, students, homeowners, tenants, job candidates and service members,” Hood said. “Unfortunately, these corporations put their business interests ahead of the best interests of Mississippians. These corporations were too busy making money and listing debt that they didn’t bother to take the time to delete errors or verify whether the debts were correct. Even worse, consumers had to fight tooth and nail to get these significant errors corrected. When Mississippi families were denied loans due to these errors and omissions, it was almost impossible for them to get a live person on the phone. When they finally reached a live person, it was even more difficult to get the errors or omissions corrected on just one credit report, much less the other two.”

Hood’s investigation started after his office began getting numerous consumer complaints about credit report errors and difficulty in correcting those errors. Of particular concern were errors in the reporting of information related to public records — such as civil judgments and tax liens. In many instances, the agencies were attributing one person’s public record to another person. They also failed to update public records information when a civil judgment, for example, had been paid or dismissed.

In addition, the agencies had no procedure in place to comply with a Mississippi law that extinguishes certain debts after three years. The agencies were routinely including extinguished debts in credit reports for Mississippians.

The attorney general also discovered that Experian and TransUnion were engaging in deceptive marketing and sale of subscription credit monitoring services. Many Mississippians — lured by the promise of a “$1 credit report” or “free credit score” — were automatically enrolled in an expensive monthly credit monitoring service they did not want and did not know about.

“Over the last three years, we have worked to end these problems and ensure that none of these practices will be allowed to continue in Mississippi,” Hood said. “I encourage consumers to take advantage of the services being offered by the agencies, such as the free, unlimited access to credit reports. Knowing your credit score and understanding your credit report helps protect you against errors, and it can be valuable in making important financial decisions.”

Equifax will launch an education initiative in Mississippi, called “Feel Good About Credit,” to educate consumers about credit and help them improve their financial lives, while TransUnion will promote the free benefits to consumers through print, digital radio and social media advertisements.

Other actions covered under the settlement include:

  • Requiring agencies to conduct annual reviews of debt collectors with high dispute rates.
  • Requiring them to stop reporting on civil judgments and liens against Mississippi consumers and to purge existing records (unless the agencies can “develop standards to protect against errors in public records reporting).
  • Development of new procedures to accurately report on debts that have been “extinguished” under Mississippi law.
  • Ensuring that bankruptcies are accurately reported.

Hood noted that many Mississippians will be receiving an email in the next few days from to let them know how they can receive free, unlimited credit reports and annual free FICO scores.

Credit card skimmers targeting Mississippi

via Credit card skimmers targeting Mississippi

PDF: the_clarion-ledger_state_20161010_a003_1

ATM skimmers have been around for decades. Security experts have long warned us about these devices, which use technology attached to an Automated Teller Machine or a Point-of-Sale terminal to steal information from consumers as they enter data.

The technology has usually been crude — one tactic has been to stick a device to the outside of an ATM located in a casino or convenience store, with crooks often putting an “Out of order” sign on nearby ATMs to direct victims to use a single machine. Thieves would collect data for a few days, then move the device somewhere else and start all over again. Often, cameras would be mounted nearby, recording the keystrokes when consumers entered their Personal Identification Numbers.

But the technological arms race between crooks and security-minded companies has yielded new technologies, and with it more brazen activities to get your money. One piece of technology uses a device installed inside the machine, making it undetectable unless the machine is opened. The tech website wrote last month about how these devices are starting to proliferate in the U.S. Skimming activities reap billions each year for thieves, U.S. Secret Service notes.

RELATED: Moak: Millennials are card smart

And for us here in the Magnolia State, it has hit home with a vengeance recently.Several skimming devices have been found inside ATMs and gas pumps at metro-area gas stations, putting law enforcement on alert. Mississippi Attorney General Jim Hood issued a news release last week to warn Mississippians about the danger.

“These devices may go undetected for weeks, all the while gathering sensitive account information from unsuspecting consumers,” Hood said. “Consumers need to call their financial institutions immediately if they see any unauthorized activity on their accounts, and watch closely for signs of tampering when using gas pumps or ATMs. In the meantime, our office will continue working with other law enforcement agencies in Mississippi to shut down this type of crime.”

Although ATM operators and financial institutions are taking action to protect the ATMs from tampering, Hood suggested some actions you and I can take to avoid becoming a victim:

  • Use pumps closer to the entrance to the service station or convenience store. Skimmers generally target pumps that are most isolated from security.
  • Avoid paying at the pump. Go into the store and pay the attendant directly.
  • If you’re using a debit card, select the “Credit” option, rather than the “Debit” option. This will avoid the possibility of thieves getting your Personal Identification Number.
  • Check with your gas station management as to how they’re checking for devices.

The online security website also recommends that you cover your hand if entering your PIN, to avoid your PIN being recorded by a nearby camera. Always use a wall-mounted bank ATM, rather than a stand-alone device, and never use an ATM located in a secluded spot, especially at night.

And as always, keep a close eye on your bank account balances and activities. The sooner you identify and report suspicious activity, the better.

Debt forgiveness in store for Mississippians

via Debt forgiveness in store for Mississippians

More than 300 Mississippi consumers will soon be getting some relief in the form of forgiven debts and updated credit reports as part of a nationwide $95.6 million settlement involving debt and collection practices of retail giant USA Discounters.

Mississippi Attorney General Jim Hood and all 49 of his fellow attorneys general announced Monday they have reached a settlement agreement with Virginia-based USA Discounters after accusing the company of unfair tactics targeting military personnel and veterans. The settlement affects 320 Mississippians, to the tune of more than $887,000.


“Our men and women in uniform, as well as our veterans, deserve better than what they were subjected to at the hands of this company,” Hood said in a news release. “These unfair, abusive tactics meant higher prices and high interest rates for our military families, who in turn were routinely at a disadvantage because of the company’s improper debt collection practices.”

The company (which declared bankruptcy after closing all its stores in 2015) did business as USA Living and Fletcher’s Jewelers, often locating its stores near military bases. The company sold furniture, appliances, televisions, computers, smartphones, jewelry and other consumer goods, principally on credit, and — despite the name — often at inflated prices. USA Discounters typically marketed to members of the military and veterans, advertising that military, veterans and government employees would “never be denied credit for goods purchased from the retailer.”

Hood and his fellow AGs alleged the company had “engaged in unfair, abusive, false and deceptive acts and practices.” One example was that, when trying to collect on outstanding consumer debts, company employees “constantly contacted” people in service members’ chains-of-command, causing some service members to lose their security clearances and face demotions.

In addition, the states alleged USA Discounters sold overpriced household goods at high interest rates, often using the military allotment system to guarantee payment. In some cases, the company filed collection suits in Virginia courts, making it difficult for members in other areas to defend themselves in court if they were stationed at other locations.

As part of the agreement, USA Discounters has agreed to write off all accounts with balances for consumers whose last contract was before June 1, 2012, and correct the negative comment from the company on those consumers’ credit reports. In addition, the company will apply a $100 credit to all accounts for contracts dated after June 1, 2012, and correct the negative credit report comment. Those actions equal about $74 million in debt being written off or credited. The company will also write off all judgments not obtained in the correct state.

For more information on the settlement, consumers can contact the Consumer Protection Division of the attorney general’s office at 800-281-4418 or visit

Predatory lenders’ prey: People with poor credit


via Predatory lenders’ prey: People with poor credit,

PDF: Preying on poor credit

If your credit score number is 600 or below, much of the lending industry considers your credit “subprime.”  Having poor credit can limit your access to better rates and whole classes of credit products and can make you vulnerable to being taken advantage of by unscrupulous lenders, warns a new report by the personal finance website Nerdwallet. Since many Mississippi consumers are carrying heavy debt, with credit scores on the low end of the spectrum, this could make them easy pickings for creditors looking to take advantage.

Nerdwallet issued the study this week, looking into the nation’s massive subprime credit market, and concluded the most-vulnerable consumers are often the least prepared to deal with slick presentations from subprime lenders. According to the report, 48 million Americans (about one in five) have less-than-stellar credit, making an attractive pool of business for unscrupulous companies. “Those consumers get unfavorable credit terms — when they can get credit at all,” reported Nerdwallet blogger Erin El Issa. “They may also pay higher insurance rates and can find their housing and job options limited.”

In addition, companies specializing in lending to subprime borrowers can be predatory, with fees and structures targeting less-educated Americans, and generally costing them much more. When you contrast that with the smorgasbord of options available to Americans with higher incomes and better credit scores, the difference is obvious. “There’s a big difference between a credit score of 600 and 800,” noted Nerdwallet credit card specialist Sean McQuay. “Consumers with excellent credit have access to the best loan terms and lowest insurance rates, as well as the most options. It’s the difference of thousands of dollars in interest fees per year. It’s the difference between being able to take the job you want and the one you have to settle for because you don’t have the available credit to cover your bills in the meantime.”

We’ve written many times before in this column about credit scores and how they can affect your ability to buy a car or house, get approved for emergency loans, and even get a job. But it bears repeating: regardless of whether your credit score is fair or accurately describes whether you are reliable or not, it’s a fact of life and could have a big impact on your future.

Here are a few key things to remember when considering your credit score:

Keep debt low. It’s not always easy to do this, especially when costs of living often outpace salaries. Keeping your debt at a low level can not only give you more to spend on necessities, it can help put you in a better position when shopping for credit. But it’s also important to remember that having zero debt generally hurts — not helps — your credit score. When it comes to your credit score, credit is like a muscle that needs exercise within reason. Buying something on credit every once in a while (never borrow more than you can afford to pay at once if you have to) is a recommended strategy.

Be careful about applying for credit. Applying for too much credit, or applying too often, can hurt your score, because consumers who are deep in debt are likely to be looking for new sources of credit to get them out of the hole they’re in. Credit scoring looks harshly at a consumer with too many applications.

Make your payments on time. This is the easiest advice to consider, but is often hard for people in debt to handle. But establishing good credit habits is a plus on your credit record.

Think before you close unused accounts. You’ve paid off that credit card? Awesome! But if you close the account, it could affect the delicate ratio between the amount of credit you have available to you and the amount you’re actually using. This is called “utilization,” and it’s a big factor in your score. So, before you decide to close the account, consider keeping it open for a while. And, if it’s just a little too tempting to use that card, cut it up, but keep the account open.

For more on the study and Nerdwallet’s findings, visit

How to avoid pitfalls of co-signing loans

Businessman and woman hand signing agreement in office

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via Bill Moak: How to avoid pitfalls of co-signing loans

PDF: The_Clarion-Ledger_State_20160611_A002_2

Being asked to co-sign a loan is not as common as it once was, but is still an option in many cases as people with poor (or unestablished) credit seek to borrow money. It may be a nice thing to do, but a new survey has found that co-signing is loaded with potential pitfalls, and you should give careful consideration to the possible implications before you sign on the dotted line. Often, co-signers get burned and if things don’t work out as planned, can be on the hook to pay back the debt, see damage to their credit scores or maybe even suffer from a damaged relationship.

Co-signing allows a third party to agree to take on some of the responsibility for the loan for someone who can’t get enough credit by themselves. According to a recent survey by, about one in six adults have co-signed a loan or credit card application for somebody else. Most commonly, the co-signer is over 50, helping a child or stepchild obtain a car loan. Co-signing can help your friend or family member get through a tough time, or establish a credit record for the first time. But, a new survey points out, there are many potential hazards that should be investigated before signing.

“Once you co-sign, you are legally responsible for the debt,” said Michelle Dosher, consumer engagement program manager for the Credit Union National Association. “It can be hard on you, and it can be hard on family and friends if that situation doesn’t work out as it was intended.” surveyed 2,003 U.S. adults about their experiences with co-signing, illustrating the potential pitfalls. Here are a few of the results:

  • Nearly four in 10 co-signers had to step up to pay some or all of the credit bill because the borrower didn’t follow through on his or her obligations.
  • Twenty-eight percent reported their credit scores dropped because of late payments or nonpayments.
  • About a quarter of respondents said their relationship was damaged because of the arrangement.

“If you co-sign and the person you are co-signing for missed a payment, that amount of debt and any missed payments can become part of your credit history, lowering your score,” Dosher said.

Dosher adds that a default can make your credit score plummet without you even knowing unless you have arranged with the borrower beforehand to keep you apprised on the loan.

“It’s your name on the line,” Dosher added. “You might have excellent credit now, and someone else’s default could ruin your credit score and affect what you are able to do on your own in the future, like refinance a home or buy a car.”

Rebecca Schreiber, a certified financial planner and co-founder of Pure Financial Education, notes that co-signing has declined over the past few decades, probably because people are becoming aware of the potential problems, but some may still decide to take the risk because they want to help out a loved one. “Co-signing is a sign of faith in another person. Sometimes we just see a financial transaction and we forget about the message behind that transaction. But co-signing is making a statement that you believe the other person will behave in a responsible way and you have faith in them.”

According to the poll, co-signers tend to be:

  • Older than 50. Twenty-four percent of 50- to 64-year-olds have co-signed a loan or card for someone else, followed by 22 percent of those older than 65. Only 14 percent of 30- to 49-year-olds have been co-signers.
  • Wealthy. Of those who earn more than $75,000 annually, 24 percent have co-signed for someone else, compared to only 11 percent of those who earn less than $30,000.
  • Helping a child or stepchild. Nearly half (45 percent) of co-signers have done so on behalf of a child or stepchild. Co-signing for a friend was a distant second at 21 percent.
  • Signing for an auto loan. Auto loans accounted for 51 percent of all co-signings, followed by personal loans (24 percent), student loans (19 percent) and credit cards (16 percent).

“If you could help an adult child go from a rental situation into homeownership and they just don’t have the credit score built up yet, (co-signing) can be great way to get them started,” said Karen Lee, an author and financial planner. When it comes to helping out a child or stepchild, 58 percent of 50- to 64-year-old co-signers have done this as well as 53 percent of co-signers older than 65.

Having to pay a loan for which one co-signs can put a serious strain even on the strongest relationships. To avoid the pitfalls, here are a few red flags that might make you think twice:

  1. The person has a pattern of not meeting financial obligations. “We all know people who are financial train wrecks,” Lee said. “If one of your financial train-wreck friends comes to you for help, but they’ve ‘turned over a new leaf,’ I would still avoid that situation.”
  2. You’re not financially stable yourself. In addition to evaluating the person you may co-sign for, you need to evaluate your own financial well-being. Do not sign on the dotted line if you are feeling financial strain. “If you don’t have (the funds) to literally give away right now, don’t do it,” Lee advises.

For the complete survey results, visit

Curbing credit scores would give consumers power

Credit Report written in search bar on virtual screenvia Moak: Curbing credit scores would give consumers power,

PDF: The_Clarion-Ledger_State_20160528_A002_0

Credit bureaus have long memories. As any consumer who’s tried to get a home loan with a less-than-stellar credit record knows, mistakes you made in the past can hang around like a ghost that never seems to go away. If you missed a credit card payment, racked up too much in debt compared to your income, or had garnishments, divorce, bankruptcies, liens or just made some questionable financial decisions, they can affect you for a decade or more. The credit score, used just about everywhere, takes all this into account and reduces you to a simple number.

For those deciding whether to grant someone credit, that number indicates just how good (or bad) a customer you’re likely to be, and they make decisions — unfairly or not — based on this simple, computer-generated number. And making it worse is the fact the credit rating is now used in a variety of situations far-removed from lending. Your credit score can keep you from getting a job, an apartment or good rates on insurance.

And, even though credit-scoring models take into account the passage of time, many consumer advocates say they are looking back too far. Credit bureaus have come under fire in the last couple of years for failing to correct erroneous information, making it difficult for people to remove negative information and even trying to upsell them with costly new products and services when they’re trying to dispute those errors.

MOAK: Survey ranks Miss. credit scores

The problem is that things change; the person you are today is usually very different than the person who let his or her payments lapse way back before you knew better.

Recently, U.S. Rep. Maxine Waters, D-Calif., (a ranking member of the U.S. House Committee on Financial Services), announced she’s about to introduce a bill that would attempt to tame some of the power wielded by credit bureaus. Among them would be a reduction in the amount of time negative information can hurt you.

“I recognize that credit information is necessary for lending decisions,” Waters said in a press call announcing the bill last week. “But the growing reliance on credit information for noncredit decisions means that credit reporting and credit scoring have a significant impact on many aspects of consumers’ lives.”

Waters’ bill would, if enacted, constitute the biggest overhaul to the credit-reporting system since the Fair Credit Reporting Act was enacted 46 years ago. Among her proposals:

Taking three years off the clock. Waters’ bill would shorten by three years the amount of time consumers could be affected by negative information. For example, an item that would normally stay on your report for seven years would now roll off in four.

Medical debt grace period. A 180-day grace period would allow you to clear up your medical-bill delinquencies before they could appear on the report.

Predatory lender provisions. If you were victimized by a predatory mortgage lender, negative information about you resulting from that loan would have to be removed.

Cutting back credit report use in hiring. It would be illegal for employers to use credit history in hiring decisions except under a narrow set of exemptions, such as obtaining national security clearances.

Student loan protection. Those who used private student loans to finance their educations could have delinquent or default information removed after making nine monthly payments in a row. (This protection is already in place for federal student loan borrowers.)

More notice. Companies that send negative information about you to a credit bureau would have to alert you within five business days.

Many consumer advocates have expressed their doubts about whether such sweeping reforms can make it through Congress and into law; however, the proposal (and others like it) could help get the ball rolling on fixing a system that most agree is overdue for an overhaul.

Millennials are card smart

Chip of the gray credit card, closeup shot.

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via Moak: Millennials are card smart,, 4/6/2016

Most of us have never known a world in which you had other options than cash or checks for paying for everyday items. While the notion of credit has always been around, cards actually didn’t hit the scene until about 1949, when Diner’s Club introduced the first plastic credit card. With the introduction of debit cards much later, consumers had a whole new set of options for paying for most everything.

Up until recently, however, cash was still king for small purchases, such as those under $5. But recent research by has indicated many consumers are swiping their cards for a pack of gum or other small items. It seems that the long-anticipated demise of cash is now occurring — albeit gradually. surveyed 616 adult U.S. credit card holders across a wide swath of demographic categories. They found that, in general, about two of every five consumers will use a credit card or a debit card for in-person purchases of less than $5. The most interesting statistic: 58 percent of consumers prefer cash for those small purchases. That’s down a full 7 percentage points from the last survey, conducted in 2014.

“There will always be a place for cash, but I think the shift to cards in the past couple years has been tremendous as people feel more comfortable using plastic,” said Rachna Ahlawat, founder and vice president of Ondot Systems, a mobile payment software development company. noted that — unsurprisingly — younger consumers prefer paying for small items with credit or debit cards. More than six in 10 of Millennials (18- to 29-year-olds) said they’d prefer to use a debit or credit card for small purchases, while less than 20 percent of those 65 or older preferred to use the plastic.

Among other findings of the survey:

  • College graduates are more likely to use cards for small purchases, while less-affluent consumers still prefer cash.
  • Parents favor cards more than childless consumers. Nearly half (47 percent) of parents use credit or debit cards to pay for small transactions compared to 35 percent of nonparents.

“Debit cards can be obtained at a very young age,” explained Stephen Lesavich, lawyer and author of “The Plastic Effect: How Urban Legends Influence the Use and Misuse of Credit Cards.” “For example, my 17-year-old son has a parent-supervised, high-school checking account at my bank, and a debit card was issued for this high-school checking account, which he tied to a mobile pay system on his mobile phone.”

Overall, Ahlawat notes, young adults prefer plastic for small transactions because they are just accustomed to swiping a card or paying online, not pulling out cash and coins. Ahlawat said her 19-year-old daughter only leaves her house with a phone and maybe one card, not a purse filled with cash. That’s a common story if you are the parents of a millennial. The wallet is becoming less a place to store cash and more of a place for ID, driver’s licenses and payment cards. noted there are several reasons for the growing popularity of cards — and the decreasing use of cash:

Convenience. It’s just easier to swipe a card than to open your wallet, deal with change or go to the ATM.

Fees. To avoid paying ATM fees, many millennials are just avoiding the machines altogether. Even though using your own bank’s ATM is usually fee-free, and ATMs are everywhere, consumers are faced with the choice of using plastic for their purchases.

Protection. “If money is stolen from a debit or credit account, there are protections in place to help consumers recover lost funds,” notes. “Even for small purchases, using a credit card is a particularly safe way to secure money, thanks to the zero-liability fraud protections provided by the major card networks.”

Rewards. Many credit and debit products provide rewards programs, which can add up to cash or merchandise.

For more on’s study, visit

Mississippians say debt collection is top gripe


via Moak: Mississippians put debt collection as top gripe,, 3/8/2016

PDF: Collection leads complaint lists

In 2015, many Americans got fed up with being harassed by debt collectors, having their identities stolen by identity thieves and being impersonated by crooks. Those three topics formed the bulk of complaints made last year to a host of federal, state and local law enforcement and regulatory agencies and private groups.

Each year around this time, the Federal Trade Commission issues its annual Data Book using data collected by Consumer Sentinel, which serves as a clearinghouse and database of complaint activity nationwide. The 2015 report listed a record 3.08 million complaints, of which nearly a third were filed about various debt collection issues. It’s worth noting that a large number of identity theft cases concerned the fraudulent filing of tax returns, in which many consumers found their taxes had already been filed (and refunds collected) by the time they went to file their tax paperwork.

Here in the Magnolia State, our consumers filed more than 18,400 complaints during 2015, with about a quarter of those dealing with debt collection practices. Second place was imposter scams, followed by prize/sweepstakes/lottery scams, telephone and mobile services issues and banks and lenders. Rounding out the top 10 Mississippi complaint categories were complaints about phone and mobile services; banks and lenders; shop-at-home and catalog sales; auto-related issues; TV and electronic media; credit bureaus, information furnishers and report users; and investment-related issues. (These numbers don’t count complaints collected by the Mississippi attorney general’s office, which handles a large number of consumer complaints filed each year by Mississippians.)

While debt collection complaints rose to the top spot among complaint categories, the report notes that this was attributable in large part to a surge in complaints “contributed by a data contributor who collects complaints via a mobile app,” but didn’t immediately disclose which one. This change caused a spike in complaints related to debt collection via mobile phones, and marked the first time debt collection overtook identity theft as the top complaint generator in 15 years.

“We recognize that identity theft and unlawful debt collection practices continue to cause significant harm to many consumers,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Steps like the recent upgrade to and our leadership of a nationwide initiative to combat unlawful debt collection practices are critical to our ongoing work to protect consumers from these harms.”

Debt collection looms large on the radar of the FTC and other regulatory agencies, and the agency noted “ramped-up” enforcement of illegal debt collection practices during 2015. A massive sweep called Operation Collection Protection resulted in more than 130 actions being brought against companies engaging in illegal collection practices.

Consumer Sentinel pulls complaint data together to use as a resource for law enforcement, using a host of partners from government regulatory agencies, law enforcement agencies and private organizations. Agencies use the data to “research cases, identify victims and track possible targets.” The data book lists a lot of statistics of the complaints reported, but more specific information is only made available to law enforcement.

To access the data book, visit