Archive for February, 2010

Credit CARD Act roundup

There’s been lots in the news now that the Credit CARD Act is hitting financial institutions.

More often than not, however, big banks are the ones doing the hitting – especially with their customer’s wallets.

Here’s a quick roundup of the latest news about big bank credit card practices and what they mean for you.

Credit Card Fees; the new trap (Wall Street Journal): “Banning these and other profitable tactics is expected to cost the card industry at least $12 billion a year in lost revenue, according to law firm Morrison & Foerster. This has sent the industry scrambling to find new sources of revenue. So get ready for higher annual fees, higher balance-transfer charges, and growing charges for overseas transactions.”

It’s a new day for credit cards (WSJ): “Annual and application fees cannot exceed 25% of your credit limit. But don’t get fooled by them. They can represent another form of interest on your account.”

Mixed blessing: credit card reform may shock some ( / AP): “During the past nine months, credit card companies jacked up interest rates, created new fees and cut credit lines.”

Remember that American 1 has not participated in the harmful practices, like annual fees, that big banks are bringing back.

To learn what we think of all this, visit and let us know how YOU feel about the new Credit CARD Act.

Today is Credit CARD Act Day

Credit CARD Act

Today, credit unions, banks, and other financial institutions are adjusting to new rules spelled out in the Credit CARD Act, a consumer protection bill that changes the nature of your credit card.

There’s a lot involved with the new law, but rest assured – American 1’s Visa program is mostly unchanged. Because we didn’t participate in some of the predatory credit card practices that define big bank programs, the Credit CARD Act doesn’t affect us drastically.

What does it change at American 1? For one, everyone’s Visa payment due date will fall after the 25th of every month. This allows us to get your Visa statement to you in enough time (at least 21 days before your due date). The other changes involve how we change rates and notices.

For big banks, though, they’re changing for the worse. Annual fees and even application fees are now becoming the norm.

For a good primer on how the Credit CARD Act affects your credit card, visit the Federal Reserve Board’s site on the law. And tune in here to get updates.

To get our perspective on credit cards, catch our video and let us know what you think.

Citi adds $60 annual fee

Citi's annual fee

Bad news if you’re a Citi credit card customer, says Connecticut Watchdog:

Many Citi cardholders are receiving letters about a $60 annual fee that is being added to their account effective April 1, 2010. If consumers make $2,400 in purchases during the year, then the annual fee will be credited back to their account.

It appears that Citi’s test of adding an annual fee to a small percentage of their customers in August of 2009 proved successful for the issuer. At that time, Citi began charging some cardholders an annual fee of $30 to $90 unless they spent at least $2,400 per year. Now a far greater number of customers are receiving this notice.

A representative from Citi says they’re imposing the hefty annual fee to “maintain the quality of our service amid the rising cost of doing business.”

So they mess up the economy, and you pay. Get it?

I first saw this on a Simple Dollar post, where a long-time Citi customer got the same letter, despite his years of loyalty. You can read the full letter at the Consumerist blog.

Is that any way to treat your customers?

We treat our members a little differently. To get our perspective, visit and let us know what YOU think of all this annual fee nonsense.

Barbara Fletcher named Rose Parade Grand Marshal

The Jackson Citizen Patriot reports:

Barbara Fletcher, 77, first organized the Rose Parade while working for WIBM-AM radio in Jackson during the early 1960s and helped it become a long-running tradition in Jackson.

This summer, she will participate in the parade for the first time in 13 years as its grand marshal…

The parade’s organizers are also seeking the input of local community members to determine this year’s parade marshal, a separate honor.

“We’re asking the community for nominations — it can be anyone,” said Liz Niles, Rose Parade and Party in the Park director.

If you have nomination ideas for Liz, drop her an e-mail at lniles at a1fcu dot org.

Look for an entire weekend of activities with the Rose Festival June 4-6.

Good advice: open your statements

A bit of good financial advice from Trent over at the Simple Dollar:

Second, read all of your notices. Even though I’m supposedly on the “paperless” plan for several of my bills, I still receive oodles of statements and messages from these companies. Most of them are completely unimportant to me…

After a while, it’s very easy to become numb to all of it. Don’t. Open every one, read it over, and handle it appropriately. Yes, most of them will go in the trash can. Yes, you’ll often feel like you just wasted fifteen minutes of your life.

But for every fifty useless missives that you read, one will be very important.

We can stress strongly enough how important it is to at least look over your statements.

Sure, if you’re a customer at a bank, you probably get gobs and gobs of mail from them every month. Us? We send minimal mail. And you could get even less if you sign up for e-statements.

But even e-statements are important. You may have important noticed posted to your account under the e-statement system, so make sure you check it at least once a month.

Bank of America pays more bonuses

If you haven’t heard, now that Bank of America has repaid the government for its bailout, its sending plenty of bonuses to its bankers.

The blog 24/7 Wallstreet reports:

Bank of America will also pass out handsome bonuses to its bankers, just a few months after its repaid the government $45 billion in aid that it got to stay in business through the credit crisis. The Wall Street Journal reports that the bonus pool at B of A will be more than $4 billion. Traders will collect an average of $300,000 to $500,000, according to the paper.

The bonuses are a return to 2006 levels, says the New York Times.

So if you’re a Bank of America customer or credit card holder, you’re helping to reward the bankers who played fast and loose with your money.

Man vs. Bank: the commercial

Check it out: you’ll soon be able to see our “Man vs. Bank” video on a Comcast commercial near you!

The wild, wild west of the credit card world

PBS’s Frontline ran a special called “The Card Game” in November on how the credit card industry hurts customers with exhorbitant fees and interest rates.

Watch the second part, especially, to get an idea of what every day consumers face with rising costs.

Good advice: Move Your Money

Laurent Belsie of the Christian Science Monitor has a bit of good advice regarding big banks:

Take your money out. That’s right. Take your checking and savings account out of that big money-center financial institution and move it to a community bank or credit union.

There’s even a movement afoot to help consumers make the switch, called Move Your Money, with a well-timed message and a good video.

Move Your Money is a project from the Huffington Post, Institutional Risk Analysis (IRA), and the Roosevelt Institute, says

Move Your Money’s objective? Simple: move your money out of the big, out-of-town banks and put it into a local financial institution. They’ll even help you find one.

The project has received media attention since its launch, which is timely considering all the bailouts and credit card shenanigans big banks are involved in.

Check out the video, which uses “It’s a Wonderful Life” to make a good point about big, out-of-touch banks and how they can affect everyday Americans.

American 1 Federal Credit Union