Credit card news roundup

Credit card rewards programs

Forbes ran a piece Thursday that repeated one of this blog's mantras. The only way to get the best from credit card rewards programs is to align your cards with your lifestyle.

The Forbes article identified three main lifestyles that are relevant:

1. Frequent travelers who are loyal to particular airlines and/or hotel chains--choose credit cards that are co-branded with your preferred suppliers, such as the Starwood Preferred Guest® Credit Card from American Express or the Citi® Gold / AAdvantage® World MasterCard®
2. Frequent travelers who need more flexibility--pick a credit card that doesn't tie you to a hotel chain or airline but that offers great travel rewards, such as the Chase SapphireSM Card, which offers double points on flights and hotel accommodation booked through its Ultimate Rewards service
3. The rest--If your lifestyle makes travel rewards, er, pointless, Forbes suggests checking out the Chase Freedom® Visa--$100 Bonus Cash Back card

Credit card debt down again

On Friday, the Federal Reserve published its consumer credit statistical release for September. It showed that, while consumer debt as a whole increased that month by $2.1 billion, revolving credit (which is nearly all credit card debt) continued to fall.

As of September 30, credit card debt stood at $813.9 billion, down $8.3 billion from August and a whopping $143.6 billion from its height in 2008. September was the 25th month in a row in which revolving credit had fallen.

In reporting the Fed's figures, The Wall Street Journal mentioned that some--maybe most--of the continuing reductions are likely to be down to credit card companies writing off debt as uncollectible, and passing it on to collection agencies. However, there are signs that Americans really are working to reduce their card indebtedness. The November edition of Consumer Reports magazine includes its National Research Center's latest annual survey of credit card users, and this found that median balances were $3,793, which is $1,100 lower than it was in 2009.

Credit card companies hated less

The same Consumer Reports survey says that Americans were slightly less dissatisfied with their credit cards in July 2010 than they were the previous year. This may be good news for credit card companies, but it would be premature for executives to start popping Bollinger corks quite yet. The magazine says:

...credit cards remain one of the lowest-rated services we've ever analyzed; only 45 percent of respondents said they were completely or very satisfied with their cards. And 16 percent said they had been treated unfairly by their card issuers (down from 21 percent a year ago).

And it goes on to point out that issuers can still unilaterally impose new borrowing limits, annual fees and minimum payments, and that they remain able to cancel an account at any time. It also cites examples of some major credit card companies that continue to flout the 2009 law that was supposed to constrain them.

Still, every little bit of progress helps.

Published 11/8/10 (Modified 4/22/12)