Tag Archives: Credit Cards

The Regular Person’s Guide to Redeeming Chase Ultimate Rewards Points For Travel

A lot of people like to hoard their Chase Ultimate Rewards points to book first class flights or five star hotels that they’d never pay for themselves, and more power to them. But I prefer to stretch mine out to cover as much travel as possible, even if it’s not glamorous. Here are the most cost point-efficient…

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What Zombie Debt Is and How It Can Come Back to Haunt You

What Zombie Debt Is and How It Can Come Back to Haunt You

On Last Week Tonight, John Oliver bought $15 million in outstanding medical debt just to prove how easy it is to start a debt buying company. It was debt that regular people owed, presumably from surgeries, hospital stays, medical procedures and so on. Instead of buying the debt to turn a profit, Oliver forgave it. All of it. The segment outlined the many flaws of the debt and credit industry, but specifically the concept of “zombie debt,” or old, forgotten debt that somehow resurfaces.

As legal site Nolo explains, zombie debt is debt that “is very old or no longer owed.” It’s debt that comes back to life when a collection agency buys it for cheap. It’s not the same as maxing out a credit card and being unable to pay or being flooded with bills you can’t haggle down. Zombie debt is often invalid, and collectors use intimidating, sneaky tactics to get people to pay.

How Zombie Debt Works

Debt collectors make money when they buy old debts incredibly cheap and get people to pay a portion of the original amount that’s bigger than what they paid themselves. Theoretically, that doesn’t sound so bad, right? Collectors just help companies reclaim lost funds, and, after all, we should all repay our debts. Fair enough.

http://twocents.lifehacker.com/what-to-do-whe…

In practice, though, debt collecting is a very shady business, and zombie debt exemplifies this. The Federal Trade Commission (FTC) lists some common types of zombie debt:

  • debts you already settled with a company or other debt collector
  • debts that were discharged in bankruptcy
  • time-barred debts you may have forgotten or overlooked that are past the statute of limitations
  • debts that no longer show up on your credit report, generally after seven years
  • debts you never owed, like debts resulting from identity theft

It’s easy to say “If you have past debt, you should pay it.” Zombie debts don’t work this neatly. As the FTC points out, they’re often the result of identity theft and they can even be debts you’ve already settled.

How Debt Collectors Get Around Time-Barred Debts

The FTC warns that you can restart the clock on the debt’s statute of limitations if you make (or just promise to make) payments. This is important because it’s how debt collectors turn a profit.

“Statute of limitations” means debt collectors can sue you for a limited amount of time to collect your past due debt. After that time, those unpaid debts are “time-barred,” and a debt collector can’t sue for time-barred debts. This time frame—the statute of limitations—varies depending on your state. Here are the statutes of limitations for all 50 states.

When you restart the clock, collectors can sue you, and many of them do. When consumers ignore these lawsuits, which happens often, they have to pay up, which can lead to wage garnishment.

However, don’t get “statute of limitations” mixed up with the time limit for negative items to stay on your credit report. Most unpaid debt falls off your credit report after seven years from the date it becomes delinquent, no matter how many times that debt is bought or sold. That’s separate from the statute of limitations.

How to Deal With Zombie Debt

Sadly, not all of us will be lucky enough to have a cable news show buy and forgive our zombie debt. We’ve told you how to deal with debt collectors before, and the cautionary rules are generally the same for dealing with zombie debt.

http://twocents.lifehacker.com/what-to-do-whe…

As you can see in the Last Week Tonight segment (and as you may have experienced yourself), debt collectors can be nasty. They use all sorts of tactics (and in some cases, intimidation and outright lying) to intimidate you into paying, from calling you nonstop to contacting your friends and family members.

http://lifehacker.com/ask-these-ques…

Thanks to the Fair Debt Collection Practices Act (FDCPA), debt collectors are not allowed to call during certain hours, use foul language, or make threats, though. So if you’re dealing with an agency breaking the rules, you can report them to the FTC. Also, abusive or threatening language are also red flags, so make sure you don’t have a scam on your hands, and here are a few questions you can ask to expose a fake debt collector. The FTC lays out your rights in dealing with debt collectors.

Assuming the agency is legit, your next order of business is to tackle them head on and make sure the debt is valid. Check out your credit report and see if the debt is listed. If not, the zombie debt may be a result of identity theft, and you can find sample letters to help dispute the debt at identitytheft.gov.

From there, ask for a “Validation Notice.” Consumer Reports explains how this works:

Even if the caller gives plausible-sounding answers, request a “validation notice” to verify the debt. The notice, which must be sent within five days of initial contact, must include the amount of the debt, the name of the creditor, and a description of your rights under the federal Fair Debt Collection Practices.

The Consumer Financial Protection Bureau offers sample request letters, too. To avoid restarting the statute of limitations, don’t even discuss the debt until you receive that notice.

http://lifehacker.com/get-debt-colle…

If you do indeed owe the money and believe you need to pay, dealing with collectors can still be tricky. We’ve written a guide to help you navigate the process, though.

http://lifehacker.com/how-to-settle-…

In most cases, dealing with zombie debt is easier said than done. A quirky television host might come to your rescue, but don’t count on it. At the very least, you should familiarize yourself with your credit report, know the statute of limitations on any past debts, and understand your rights.

Photo by Ryan Jorgensen – Jorgo

May’s Money Challenge: Save Money on Interest

May’s Money Challenge: Save Money on Interest

With our year long Ultimate Money Challenge, we’re challenging readers to a different personal finance challenge every month. This month, we’re taking on debt. Let’s cut your debt interest rate.

Interest can really put a damper on your goal to get out of debt. Instead of putting all of your money toward the debt’s principal, you have to dedicate some of it to interest, which means you pay more over time and your payoff takes longer. That’s why this month’s challenge is to reduce your debt interest rate. Some ways to do this:

Some of these moves shouldn’t be made lightly. For example, student loan refinancing can nab you a lower interest rate, but if you have a federal loan, you could lose your relief options. These options aren’t right for everyone, but we challenge you to find which options may be right for you, so you can save money on interest and get one step closer to your debt payoff.

If you’re up for the challenge, tell us your plan of action. What can and will you do this month to lower your debt interest?

Photo by frankieleon.

Why You Should Make a List of Every Account Linked to Your Credit Cards

Why You Should Make a List of Every Account Linked to Your Credit Cards

There aren’t many drawbacks to automating your finances, but one you occasionally encounter is having to update all of your bills when you get a new credit or debit card. To make it easier, finance writer J.Money suggests making a list of every account linked to your cards.

Maybe your card info was hacked and you had to order a new one. Or maybe you got a new chip credit card and your old one no longer works. Whatever the scenario, it can be a minor pain to go through all of the accounts linked to your card. Having a list of those accounts on hand is incredibly useful when that happens.

Over at Budgets Are Sexy, J. Money points to a couple of other reasons why this tip is helpful.

  1. It makes updating your new card everywhere MUCH faster
  2. It prevents any late fees from happening, or worse – shutting off of services since you don’t forget where it’s all listed anymore!
  3. It keeps stress levels as low as possible
  4. And it forces you to re-evaluate all the services/apps/products/bills you have to see if it’s still worth including in your life.

All it takes is sitting down and making a list once, and then as you link new accounts, simply add them to the list. For more detail, head to J.Money’s full post.

TIP: Make a list of where all your credit cards are listed! | Budgets Are Sexy

Photo by Sean MacEntee.

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Credit cards aren’t just convenient ways to pay for things. When used strategically, you can reap valuable rewards and perks you won’t get by paying with cash. Maximize your credit card rewards with these top 10 tips.

10. Pick the Best Rewards Credit Cards for Your Lifestyle

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

The best rewards credit card won’t be the same for everyone. It depends on how much you spend on different categories. If you often shop at the same retailers, consult this chart to see which credit cards will save you most at those stores. If you shop mainly at Amazon, some credit cards are more rewarding for that than others. If you’re a frequent traveler, you might be interested in credit cards that give you free hotel stays or companion plane tickets. We’ve rounded up some of the best credit cards for earning rewards here and compared five rewards credit cards in our Hive Five. You can also consult this graphic, which compares 25 popular rewards credit cards. So many to choose from!

9. Use a Cash Back Shopping Portal

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Every time you shop online, you can earn extra points, miles, or cash back. Your credit card bank has its own shopping portal you can start your shopping spree from, such as Chase’s Ultimate Rewards, but there are also cash back sites such as Ebates and FatWallet. The rewards will differ depending on where you’re shopping. To that end, find the right shopping portal for each store using a site like Cashback Monitor or previously mentioned Evrewards.

8. Buy and Sell Gift Cards for More Cash Back

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

If your card offers double (or more) points for shopping at a store where gift cards are sold, such as grocery stores or office supply stores, buying gift cards there could earn you bonus rewards. Keep in mind, however, this depends on your credit card company and the store you’re shopping at: Some stores will mark that you bought a gift card there and some banks don’t allow bonuses on them. Also, if you redeem your credit card rewards for gift cards, you can turn around and sell them to boost your return, depending on your credit card’s cash back rates.

7. Activate Your Rewards Categories

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

This one’s a no-brainer, but often we forget to activate the rotating rewards offered by our credit cards. You’ll usually get a reminder email from the credit card company, but you could also set a calendar reminder for activating the bonus categories. They usually happen quarterly.

6. Ditch the Annual Fee

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Certain rewards credit cards, particularly travel rewards cards, charge annual fees. Sometimes the benefits are worth it, but if you get the annual fee waived, you’ve just boosted the card’s value. All you have to do is ask. They might say no, but it’s worth a shot.

5. Time Your Credit Card Sign-up for the Biggest Bonuses

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Occasionally, credit card companies increase the sign-up bonuses, which can be worth free flights or hundreds of dollars. That’s the best time to get a rewards credit card, not when they’re offering the normal sign-up bonus. NerdWallet found the best times of the year to get these extra bonuses.

4. Use Your Credit Card’s Hidden Perks

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Beyond the popular benefits like cash back and purchase protection, most credit cards offer other rewards, such as travel insurance and roadside assistance. Check your policy to avoid spending on benefits already covered by your credit card.

3. Connect Your Credit Cards to Loyalty Programs

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

There are a few loyalty programs that reward you for dining out or shopping at particular places. Join the program and connect your credit card, and each time you eat or shop there, you’ll earn rewards towards cash back or miles. Or in Upromise Dining’s case, cash towards college. iDine, AAdvantage Dining, and Thanks Again are other programs to consider.

2. Rotate Your Credit Cards and Use Them for Everything

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

You’ll get even more rewards if you have multiple cash back credit cards, since each pays more for different categories. I have a dedicated card for grocery shopping, for example, for 5% cash back, a card for Amazon purchases, a regular 2% cash back card, and so on. If you have a hard time remembering which credit card is for what, keep a cheat sheet in your wallet. Also, if you’re responsible and pay off all your purchases every month, use your credit cards for everything, even bills if possible.

1. Redeem Your Points and Miles

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Finally, don’t let your miles or points just sit around in your credit card account. Some rewards expire. Even if yours don’t, the biggest mistake people make with their credit card rewards is not using them. (Although saving them for a big trip or for emergency flights is fine too.) If you have no need for your rewards, you can donate them or gift them to a family member or friend (or me).

All this said, remember to always make your credit card payments on time. Otherwise, you can not only lose your rewards, you could find yourself in a debt hole not worth the credit card rewards to begin with.

Illustration Fruzsina Kuhári.


Lifehacker’s Weekend Roundup gathers our best guides, explainers, and other posts on a certain subject so you can tackle big projects with ease. For more, check out ourWeekend Roundup and Top 10 tags.

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Credit cards aren’t just convenient ways to pay for things. When used strategically, you can reap valuable rewards and perks you won’t get by paying with cash. Maximize your credit card rewards with these top 10 tips.

10. Pick the Best Rewards Credit Cards for Your Lifestyle

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

The best rewards credit card won’t be the same for everyone. It depends on how much you spend on different categories. If you often shop at the same retailers, consult this chart to see which credit cards will save you most at those stores. If you shop mainly at Amazon, some credit cards are more rewarding for that than others. If you’re a frequent traveler, you might be interested in credit cards that give you free hotel stays or companion plane tickets. We’ve rounded up some of the best credit cards for earning rewards here and compared five rewards credit cards in our Hive Five. You can also consult this graphic, which compares 25 popular rewards credit cards. So many to choose from!

9. Use a Cash Back Shopping Portal

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Every time you shop online, you can earn extra points, miles, or cash back. Your credit card bank has its own shopping portal you can start your shopping spree from, such as Chase’s Ultimate Rewards, but there are also cash back sites such as Ebates and FatWallet. The rewards will differ depending on where you’re shopping. To that end, find the right shopping portal for each store using a site like Cashback Monitor or previously mentioned Evrewards.

8. Buy and Sell Gift Cards for More Cash Back

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

If your card offers double (or more) points for shopping at a store where gift cards are sold, such as grocery stores or office supply stores, buying gift cards there could earn you bonus rewards. Keep in mind, however, this depends on your credit card company and the store you’re shopping at: Some stores will mark that you bought a gift card there and some banks don’t allow bonuses on them. Also, if you redeem your credit card rewards for gift cards, you can turn around and sell them to boost your return, depending on your credit card’s cash back rates.

7. Activate Your Rewards Categories

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

This one’s a no-brainer, but often we forget to activate the rotating rewards offered by our credit cards. You’ll usually get a reminder email from the credit card company, but you could also set a calendar reminder for activating the bonus categories. They usually happen quarterly.

6. Ditch the Annual Fee

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Certain rewards credit cards, particularly travel rewards cards, charge annual fees. Sometimes the benefits are worth it, but if you get the annual fee waived, you’ve just boosted the card’s value. All you have to do is ask. They might say no, but it’s worth a shot.

5. Time Your Credit Card Sign-up for the Biggest Bonuses

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Occasionally, credit card companies increase the sign-up bonuses, which can be worth free flights or hundreds of dollars. That’s the best time to get a rewards credit card, not when they’re offering the normal sign-up bonus. NerdWallet found the best times of the year to get these extra bonuses.

4. Use Your Credit Card’s Hidden Perks

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Beyond the popular benefits like cash back and purchase protection, most credit cards offer other rewards, such as travel insurance and roadside assistance. Check your policy to avoid spending on benefits already covered by your credit card.

3. Connect Your Credit Cards to Loyalty Programs

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

There are a few loyalty programs that reward you for dining out or shopping at particular places. Join the program and connect your credit card, and each time you eat or shop there, you’ll earn rewards towards cash back or miles. Or in Upromise Dining’s case, cash towards college. iDine, AAdvantage Dining, and Thanks Again are other programs to consider.

2. Rotate Your Credit Cards and Use Them for Everything

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

You’ll get even more rewards if you have multiple cash back credit cards, since each pays more for different categories. I have a dedicated card for grocery shopping, for example, for 5% cash back, a card for Amazon purchases, a regular 2% cash back card, and so on. If you have a hard time remembering which credit card is for what, keep a cheat sheet in your wallet. Also, if you’re responsible and pay off all your purchases every month, use your credit cards for everything, even bills if possible.

1. Redeem Your Points and Miles

Top 10 Ways to Squeeze More Rewards Out of Your Credit Cards

Finally, don’t let your miles or points just sit around in your credit card account. Some rewards expire. Even if yours don’t, the biggest mistake people make with their credit card rewards is not using them. (Although saving them for a big trip or for emergency flights is fine too.) If you have no need for your rewards, you can donate them or gift them to a family member or friend (or me).

All this said, remember to always make your credit card payments on time. Otherwise, you can not only lose your rewards, you could find yourself in a debt hole not worth the credit card rewards to begin with.

Illustration Fruzsina Kuhári.


Lifehacker’s Weekend Roundup gathers our best guides, explainers, and other posts on a certain subject so you can tackle big projects with ease. For more, check out ourWeekend Roundup and Top 10 tags.

Activate Your Credit Card’s “Rotating Rewards” to Get Even More Cash Back

Activate Your Credit Card’s “Rotating Rewards” to Get Even More Cash Back

When you use them responsibly, credit cards are awesome for earning cash back or travel rewards. During certain months, issuers offer bonuses for spending in certain categories, too. As NerdWallet points out, though, you have to activate these “rotating rewards” in order to cash in.

They explain:

For the second quarter of 2016, April through June, some cards are offering bonus rewards on restaurants and movies as well as grocery stores and wholesale clubs.

If you’re not familiar with rotating-rewards credit cards, the concept is pretty simple. This type of card gives you 1% cash back on most purchases, but 5% back on one or two bonus categories that change every quarter. However, you have to opt in to the category, or “activate” it, to get the bonus. There’s a limit on how much cash back cardholders can earn on the bonus categories (usually $1,500 in spending, or $75 per quarter). Cards typically offer 1% back on spending above that limit.

It’s easy enough to opt in. Log into your account, navigate to your rewards, then look for the option to activate.

Especially with consumer debt on the rise, we need to plug our standard disclaimer here: only use cards for stuff you were planning to buy anyway, and make sure to pay off your balance in full every month.

http://twocents.lifehacker.com/master-these-m…

For more detail, head to NerdWallet’s full post at the link below.

NerdWallet’s Best Credit Card Tips for April 2016 | NerdWallet

The Best Time of Year to Sign Up for a Rewards Credit Card

The Best Time of Year to Sign Up for a Rewards Credit Card

Credit cards use rewards to lure customers, but play the game right, and you can come out ahead. Most issuers offer awesome sign-up bonuses during certain times of the year. A new study from NerdWallet reveals the best months to sign up for different rewards credit cards based on these offers.

http://lifehacker.com/only-use-credi…

NerdWallet analyzed limited-time offer patterns of popular credit cards to figure out the best time for customers to take advantage of these deals. In general, they found that customers miss out on $177 worth of rewards and 15,338 worth of travel points by applying for their rewards card at the wrong time.

They found that for travel and airline credit cards, the best time to take advantage of these offers is November. For hotel cards, August had the most offers. In general, NerdWallet found that three of the most popular issuers for rewards—Chase, Citi and American Express—offer the most deals in late summer and fall. The above graphic shows the number of limited-time offers of each issuer by month.

Here’s how they explain their methodology:

Specifically, we verified our internal limited time offer data by looking at travel sites such as The Points Guy, Million Mile Secrets and One Mile at a Time, as well as specific issuer sites. We found at least two sources for each limited time offer to verify that we had the correct offer dates. We got our ideal booking data (47 days) from an analysis by CheapAir.

To calculate the average points or miles lost by applying for a card without a limited time offer, we took the difference between a card’s best offer and regular offer and weighted it based on the popularity of the cards we analyzed. We multiplied the points by the weighted average value of the rewards of these cards to get a dollar amount.

We’d be remiss not to remind you to use credit card rewards responsibly. Always pay off your balance in full and understand how signing up for a new card affects your credit.

http://twocents.lifehacker.com/money-advice-n…

If you’re into the travel rewards game, you’ll want to check out their full results at the link below. They also offer some interesting insight on when you should sign up for a travel rewards card, depending on when you’re planning to travel.

NerdWallet Travel Credit Card Study | NerdWallet

Ask an Expert: All About Maximizing Your Credit Card Travel Rewards

Ask an Expert: All About Maximizing Your Credit Card Travel Rewards

By carefully using the right credit cards for your daily expenses, you can accrue air miles and other travel rewards with little effort. In fact, Brad Barrett of RichmondSavers.com says you can practically travel for free if you play your cards right.

Brad has a background in finance—he’s a CPA by day—and knows his way around the best credit cards for travel rewards. He also teaches a free online course on the subject. So how do you maximize those air miles and which cards should you use? Brad will be here for the next hour so leave a question below!


Master These Money Habits Before You Start Using Credit Card Rewards

Master These Money Habits Before You Start Using Credit Card Rewards

Some credit cards are awesome for earning rewards like extra cash or free travel. If your money habits aren’t great, though, those cards can lead to consumer debt. Credit.com recommends mastering these three money habits before jumping into the credit card rewards game.

http://lifehacker.com/only-use-credi…

First, you want to make sure you’re in the habit of paying balances off in full. If you’re accumulating interest, that kind of offsets the whole rewards thing. Second, you should have a solid credit score. This shows you’ve developed responsible habits, plus, it qualifies you for better rewards cards.

Finally, you want to make sure you’re good at sticking to your monthly budget. If you’re having trouble staying disciplined, you don’t want to play with fire. And if your finances are already stretched thin, you don’t want to get caught in a debt trap.

http://twocents.lifehacker.com/common-debt-tr…

Of course, there’s a lot more to consider, but these three factors are a good general summary of using credit card rewards responsibly. For more detail, head to the full post at the link below.

http://twocents.lifehacker.com/money-advice-n…

3 Signs You’re Ready for a Rewards Credit Card | Credit.com

Photo by reynermedia

Contact the author at kristin.wong@lifehacker.com.