Effect of New Credit Card Law on Statements

[LadyInTheRed]

I haven't yet stopped paying my CCs. Because of the new law, one of my credit card statements now has a section telling me that if I pay the $103 minimum payment it will take me 26 years to pay it off and I will pay almost twice what my current balance is. My mortgage will be paid before that! And this card is at a very low permanent rate of 3.99%. It also says that if I pay $168 a month, the balance will be paid in 3 years.

If only I could pay another $68 and whatever else I would have to pay on my other CCs to pay them off in 3 years!

I wonder where I'd be now if that information was on all of my statements beginning about 25 years ago when I was a college student and got my first CC.

I actually look forward to seeing the first statement after I stop paying showing a 29.99% default interest rate. I can't wait to show it my middle finger!

[DebtStinks]

Ya it's crazy. I can remember back when I had a Discover Card that if I only paid the minimum each month the balance owed would actually grow by a few dollars. I think at some point they changed the law so that can't happen. But still... 26 years. Haha.

I will never carry a balance on a credit card again. Too bad I had to learn the hard way.

[Overmihead]

We just got our first statement with that info on it as well. It's really eye opening to see the math.

I wonder where I'd be now if that information was on all of my statements beginning about 25 years ago when I was a college student and got my first CC.

Absolutely! I think it would have made a big difference for a lot of people. But that's the type of info the CC companies didn't want us to know!

[fireworks]

Through high school and college I had several teachers give lectures about debt, interest and the evils of credit cards. The math isn't that complicated, but we don't really think about the overall effect of it until it's all laid out in front of us.

Amusingly enough my college math professor railed against credit cards but spoke favorably about student loans. I suppose that student loans are better in most cases, but I'm about to discharge well over $100K in credit cards and still have over $20K in student loans to pay off.

[helpmeout]

We just got our first statement with that info on it as well. It's really eye opening to see the math.
Absolutely! I think it would have made a big difference for a lot of people. But that's the type of info the CC companies didn't want us to know!

I just saw that on what is probably going to be my last Citi statement (I go in next week to sign the paperwork). Real eye opening.

[helpmeout]

Through high school and college I had several teachers give lectures about debt, interest and the evils of credit cards. The math isn't that complicated, but we don't really think about the overall effect of it until it's all laid out in front of us.

Amusingly enough my college math professor railed against credit cards but spoke favorably about student loans. I suppose that student loans are better in most cases, but I'm about to discharge well over $100K in credit cards and still have over $20K in student loans to pay off.

When I had a student loan (it was paid just before my ex and I split), the interest rate didn't change if I made a late payment on the loan or on any of my credit cards. And the interest rate was a set rate. You have a better chance of paying off a student loan than you do a credit card loan. Not to mention, that once you are done with school, you can't keep adding to the student loan. Unlike with a credit card.

[robertg]

If the credit card companies disclosed information to consumers in a way that was easy-to-understand then most people would not have been using the cards.

It's crazy that most people still think of credit cards as 'temporary loans'---with out understanding the difference between, say, daily compounded interest vs simple interest.

The whole industry is built on deceiving regular people and it's sickening. In my opinion, the credit card biz is worse than the mortgage biz.

Robert G
[Active advertising link removed. Against forum rules.]

[BROKEDED]

The industry is built on deceiving everybody, not just regular folk. That's why they hire the best ad agencies, spend tens of millions in ads, have some of the most memorable commercials, and allow you to personalize your debt.

Want rebates for cash, gas, flights, department stores, food? No problem! Want your picture on your card? Why not! Allow friends, family, employees, to be listed as users? Sure! Have your family dog, your son's birthday party, your daughter's recital as your card background picture? Abso-friggen-lutely!!!

I haven't even filed yet but I cut my cards up about 2 months ago and it still feels weird not having one in my wallet. It's like I leave the house with some slight anxiety that something's going to happen where I'll need a credit card. People have been conditioned for decades to at least carry one in case of emergency..."Don't leave home without it!" Right?

I'm slowly getting used to, and enjoying just using cash or debit. I may even stop using debit where I can as I see that more closely tied to credit cards than cash.

Who knows, maybe I can just start bartering in chickens and eggs!!!

[fireworks]

I'm slowly getting used to, and enjoying just using cash or debit. I may even stop using debit where I can as I see that more closely tied to credit cards than cash.

Many studies have found that consumers spend more when paying with plastic then when they pay with cash. The effect is more pronounced with credit cards but is still true (to a lesser extent) with debit cards. Something about the green paper leaving your wallet registers in your brain differently. When I started my business I got more mailers than I can count from card processing companies telling me all of these things - credit buyers buy now, cash buyers wait until payday. Credit buyers buy more. Credit transactions are easier and faster to process. Here's one very recent article:

http://www.psychologytoday.com/blog/...d-credit-cards

I'm right now on a trip to a tradeshow. My employer will reimburse my expenses once I get back, but it's been a VERY different experience doing this in cash. The last time I was down here I financed the whole trip on a credit card - my accountant's advice, because it's "easier to track and record" on my taxes. And yes, I was able to get a hotel room with my debit card, no questions asked.

[LadyInTheRed]

The industry is built on deceiving everybody, not just regular folk. That's why they hire the best ad agencies, spend tens of millions in ads, have some of the most memorable commercials, and allow you to personalize your debt.

And here's a perfect example: I got an email from American Express telling me that as part of their continued efforts to provide excellent service they are adding helpful notices to their statements. They conveniently left out that the notices are required by law. LIARS!

[catleg]

What's really sickening is the 2%+ bite they take out of every transaction. I had to really hold my nose when donating by debit card to Doctors without Borders after the earthquake.