Month: August 2009


FIRST WAVE OF CC CHANGES …


Thursday of last week (8/20) marked the first wave of the much anticipated (and much needed) credit card legislative changes for consumers. Below is a summary of the credit card modifications (8/20/2009) …

EXTENDED GRACE PERIOD.

All credit card statements must be mailed 21 days prior to due date, rather than the prior 14 day grace period. The law states that a card company cannot charge late fees if statements are not delivered at least 21 days before the payment due date.

45 DAY NOTIFICATION.

A 45 day notice prior to any increase in APR (annual percentage rate) and any “significant changes” in contract terms (as deemed by the Federal Reserve Board) must now be afforded consumers. This notification must explain the steps for cardholders to take to exercise their rights to cancel the account — a toll free number and deadline for opting out must be provided.

RIGHT TO OPT OUT.

Consumers will have the right to cancel (“opt out” of) a card to avoid adverse changes in terms. This would provide the card holder with the ability to repay the card balance under the original terms (hopefully this is obvious, but opting out would preclude the consumer from continuing to use the card for new purchases). There are a few key exceptions to this opt out policy:

(1) Consumers cannot opt out of increases in the minimum payment

(2) Consumers cannot opt out of rate changes on variable rate cards

(3) Consumers 60 days late (or more) making payments cannot opt out

(4) Consumers cannot opt out of reductions in credit limits

The next waves of legislative changes will take place in February and August 2010. The following link provides a helpful view of the credit card reform timeline. Also, I posted an overview of the C.A.R.D. Reform in May that discusses in more detail these upcoming changes.

FINANCIAL GOALS


This past week, I accepted the challenge of hiking Mount Timpanogas, one of the highest peaks in the Wasatch Mountains (Utah). It was a breathtaking experience! During the hike, it got me thinking about goals and the purpose of goals, specifically financial goals… Here are just a few of my random thoughts about goal setting that struck me.

WHY HAVE GOALS?

– Assist in organization

– Define priorities

– Encourage self-understanding

– Enhance self-confidence

– Feed determination/motivate

– Guide behavior

– Guide decision-making

– Identify needed changes

– Improve planning

– Increase probability of success

– Keep us focused

– Provide purpose and direction

“Goals are not just the destination you're driving toward, they're also the painted white lines that keep you on the road.”

Most of you are familiar with S.M.A.R.T. goals – some have suggested expanding the definition of a SMART goal

S – Specific — consider stretching, synergistic, and systematic.

M – Measurable — add meaningful, memorable, and motivating.

A – Achievable — and action plans, accountability, agreed-upon.

R – Relevant — also realistic, reasonable, resonating, and rewarding.

T – Time-based — timely, tangible, and thoughtful.

This quote from Alice in Wonderland (conversation between Alice and the Cheshire Cat) has always been a favorite of mine …

“Would you tell me, please, which way I ought to go from here?”

“That depends a good deal on where you want to get to,” said the cat.

“I don't much care where …” said Alice.

“Then it doesn't matter which way you go,” said the cat.




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