Tempting? Sure, but store credit cards are rarely a good deal

By Jim Sloan

It was Christmas time, and I was going through the checkout of a large chain department store with a shopping cart full of stuff. I was spending far more than I normally would, so when the cashier asked if I was interested in saving 10 percent right on the spot by simply applying for a store credit card, I shrugged and quickly agreed.

Six months later, when I finally crawled out from under the suffocating 25 percent interest rate charged against the balance on that card, I vowed to never again get a store credit card. Not only did I sign up without reading the fine print--always a mistake in the credit card business--but I also didn't count on only being able to use the card for just that one chain.

Little did I know that there were other reasons to avoid store credit cards in favor of something better like a rewards credit card or a 0 balance transfer card. So I did a little poking around and found three other big reasons to just say no to that kindly cashier's offer for a store credit card. Here goes:

1. Your credit score may suffer

According to Reuters, just opening a store brand card will lower your credit card 60 points, which is a pretty big dent and could damage your chances if you happen to also be applying for a car loan or mortgage. If you apply for a lot of store cards in a short period of time, you could find it difficult to...

By Jim Sloan

Credit cards come with all kinds of special features these days--zero interest balance transfers, free money rewards and even cash back promotional offers.

But many credit cards also often come with some kind of extended warranty for products you purchase with the card. What this means, usually, is that the credit card company will extend the terms of the original manufacturer's warranty for a period of time equal to the original warranty up to one year. Some extensions are only for six months, however.

In other words, if you purchase something with a 90-day manufacturer warranty on one of your zero percent credit cards that offers an extended warranty, you will enjoy a 180-warranty period. If you buy something on that card with a five-year warranty, you'll have six years of coverage.

The credit card's responsibility for covering your purchase only kicks in after the original manufacturer's warranty runs out.

Many people confuse extended warranties with things called "service contracts." Service contracts are a repair program you purchase from a store or a manufacturer which ensures that if your purchase breaks--either through faulty construction or because you brought your laptop into the bath with you and it got wet--it will be repaired or replaced free of charge.

Credit card warranty extensions are not service plans. Credit card warranties typically only cover defects in materials or workmanship; they won't protect you if you shower with your Macbook Pro.

By Maryalene LaPonsie

Remember when you couldn't go to the grocery store and buy a gallon of milk unless you had a couple dollars in your pocket? The move toward plastic started with gas stations and grocery stores, but for me, the defining moment came when I no longer had to worry about scrounging for change to buy breakfast on my way to work. Yes, one day - one glorious day - the clouds parted and the heavens sang and the fast food joints in the town began accepting credit cards.

So today you can buy everything from a 79 cent pack of gum to a $7,900 diamond bracelet with a little help from Visa, Mastercard and company. But should you?

While it may be convenient, there are 5 things you should avoid charging to your credit card:

Groceries: OK, if you are out of diapers and out of cash, it might be better to use credit than wrap little Johnny in a towel and hope for the best. But if you find yourself in a situation where you are charging groceries every week because you don't have any other way to pay, it is time to take off the rose-colored glasses: You have a problem. You need to figure out a way to spend less or earn more.

Now, the exception to this rule would be if you use one of the best cash back credit cards and pay off your balance each month. With zero percent credit cards and cash rewards, you can actually come out ahead so long as you don't carry a balance. Otherwise, you might be paying interest on those diapers for the next five years if you start making only...

By Jim Sloan

More than a few of us have felt our jaws drop when opening a bill from one of our credit card companies.

Maybe you were shocked to see that your interest rate had jumped on your zero percent credit cards or that there were fake credit card numbers on your bill. Or maybe those balance transfer offers were not as good as you thought, or that best cash back credit card you got didn't reward you the way you expected it to.

Chances are the details were outlined to you in the fine print of your credit card application. But if these surprises weren't included in that disclosure and that the charges are unfair or unjust, you do have the right to complain about your credit card company to a state agency or the federal government.

The first step

Before reporting your credit card company to your state or federal agencies, try to work out your differences with the company itself. Call and explain your problem to them and ask about what procedures you should follow to correct the problem.

If that doesn't help, you can file...

By Beth Orenstein

College students now owe more money for their education than the nation owes on credit cards. According to a recent story in the New York Times, last year, student loan debt outpaced credit card debt for the first time. Not only that, but student loan debt is expected to top a trillion dollars - a figure that's hard to fathom.

The mountain of student debt is rising at a rapid pace. According to those who track it, in 1993, less than half of those graduating were in debt when they did so. Eleven years later, two-thirds of those receiving bachelor's degrees owed big time. Last year, those who borrowed money to attend college graduated with an average debt of $24,000 - as much money as their grandparents probably paid for their first home.

Burden of student debt likely to worsen

The situation is only likely to get bleaker. Public colleges and universities may have no choice but to raise tuition and fees as the states reduce the subsidies they give them - states across the country are facing their own budget crises and have to cut somewhere. Higher education is an easy target.

Not only do graduates owe money for their schooling, but many also owe on credit cards. They'll be paying for a long time. And with the sour economy and unemployment still near 10 percent, how easy can it be to find a job that covers living expenses and debt payments?

Tips for digging out of student debt

So, if you're about to graduate and owe on loans and credit cards, what can you do to dig yourself out of debt?

By Kathryn Hawkins

I remember my first day of college well: Unloading my bags in my cubicle-sized dorm room, giving my mother a hug goodbye, and of course, checking out the credit card booths in the center of campus, where countless representatives offer free T-shirts and thousands of dollars worth of credit without explaining exactly how those shiny cards work. Although some of the best credit cards for students can be found there, most students, myself included, were looking for the free stuff. Luckily, I managed to keep my credit card debt under control--but a lot of my friends got into financial struggle that they're still struggling to escape from a decade later.

Want to help your teenagers learn financial responsibility before they head off for the wild world of college? Then consider making them authorized users on your credit card account while they're still under your roof. You may worry about them racking up huge bills, but in fact, teaching your children how to manage credit now with no fee credit cards linked to your account will help them avoid getting into debt later. Here's why you shouldn't be afraid to hook your kids up with credit cards.

1. A supervised environment is the best place to start. A student credit card is all too often many people's first exposure to credit cards. However many find themselves unprepared since they often have little understanding of cards' payment terms and interest rates. As a result, students often get in over their heads: In a 2008 survey, Sallie Mae found that the average college student...