Here are a few credit card highlights from the past week. A study showed that many people are using credit cards just to survive, that people seem to be choosing credit over debit when buying stuff, and that it’s essential to take steps to protect your identity before you ever leave your house. Oh, and as always, there’s news about prepaid cards.
I hate hearing news like this. But I can’t say I’m surprised, either, because many people are still recovering from the Great Recession. A new study shows that 40 percent of low- and moderate-income families rely on credit cards just for basic needs. This percent goes up to 45 percent for families with incomes less than $50,000. According to this story, the restructuring of employment benefits has partly led to the crisis, especially for those who have been out of work for six months or more.
This story caught my eye because it says a lot about our current spending habits. Debit card spending was down 12 percent in April and 8 percent in May. On the flip side, credit card spending increased 8 percent in April and 10 percent in May.
New regulations that decreased revenue on debit card transactions have resulted in credit card issuers encouraging consumers to choose credit more often than debit. This article does a good job of explaining how the market response to regulations can change spending patterns over time.
This article offers practical and smart tips for avoiding identity theft while traveling, such as alerting your credit card issuers before you leave and simplifying the number of cards in your wallet.
There are also tips for how to proceed if you do end up as a an identity theft victim while you’re on the road. Read this before you pack for vacation or for that next business trip.
Okay, full disclosure: I’m quoted in this story. But I wanted to highlight it because Susan Tompor, the personal finance columnist for the Detroit Free Press, does a great job giving consumers an overview of this industry.
Would you believe more than 7 million consumers use prepaid cards? And believe it or not, about $57 billion (yes, billions, not just millions) were loaded onto prepaid cards last year. Read the article for more insight into this popular, but fee-driven, industry.