Timing travel reward credit cards just right

These days, there are many different types of credit cards for consumers to choose from. This includes a range of rewards based credit cards including those that offer travel rewards. These cards are ideal for those who like to or need to travel on a regular basis, as it can save them a small fortune. The cards work by enabling users to earn points or air miles when they make purchases using their plastic, and these can then be put towards various travel perks such as hotel rooms and flights amongst other things.

However, while these travel based credit cards can be incredibly useful for those who tend to travel a lot, the data from a recent study suggests that many people could be missing out. The study was carried out by NerdWallet and showed that many consumers were really missing out simply because they applied for their travel based rewards credit card at the wrong time.

Missing out on thousands of rewards points

According to the data from the NerdWallet research, cardholders are missing out on just over 15,000 rewards points on average, which equates to just under $180 in terms of monetary value. However, officials said that the reason behind this problem was because many people were failing to make their rewards credit card application when credit card companies were offering the best deals in terms of rewards. Experts said that there was a clear and noticeable discrepancy in relation to when consumers were applying for these travel rewards credit cards and when they should be applying in order to optimize on rewards.

Researchers also stated that failing to compare cards and deals was affecting rewards levels for consumers. One official said that the level of the rewards could vary widely from one card provider to another as could bonuses such as sign up bonuses and annual bonuses. By looking at the various deals and cards, consumers are more likely to be able to get the best travel rewards deals. However, they are also being warned to calculate the cost of missed points and rewards if they do decide to hold out for better deals.

It is also important for cardholders to bear in mind that the interest charged on an outstanding balance will outweigh the value of rewards earned. Therefore, these cards should ideally be used by those who are able to repay the balance in full each month thus avoiding interest charges while still earning rewards. 

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Canadian economy weakens watchdog focuses on payday loans

Since the collapse in the price of oil, a few regions in Canada have faced an economic crisis. Alberta, the once oil-rich behemoth that generated enormous revenues for the province and the federal government, is now a wasteland looking to recuperate from the immense losses.

Over the last 18 months, there have been numerous horror stories occurring from Edmonton to Calgary, from Fort Vermilion to Red Deer. Most of the tales consist of families looking to sell their homes, households going into debt and unprecedented cases of bankruptcies. Akin to other oil-rich nations and states, Alberta has been Canada’s biggest victim in the oil price drop.

With many Albertans in financial destitute, numerous services have been booming. One of them is the payday loan industry. As Albertan consumers now live paycheck to paycheck and are on the brink of a personal collapse, they are desperate for funds. Lenders in partnership with lead aggregators like Landmark Cash are “raking in the dough”. If a light bill is due or the car breaks down then they may have to turn to a payday loan store in their community.

Canadian authorities are concerned that a large number of Canadians will set themselves up for an endless cycle of debt. Officials warn payday loans come with excessive interest rates, exorbitant fees and other costs that prompt customers to return for the second or third time. This is why the Financial Consumer Agency of Canada will initiate an investigation into the industry.

“From my perspective, it’s always been a concern,” said Brigitte Goulard, deputy commissioner of the FCAC, in an interview with the Globe and Mail. She added that the watchdog organization will release the results from its pending investigation into what she refers to as “predatory” payday lending and how the industry may or may not impact Canadian consumers.

At the same time, several provinces, including Alberta, will review current regulations. With 20,000 job losses last year and a large increase in bank loan defaults, Alberta New Democratic Party Cabinet Minister Stephanie McLean is concerned that the province’s economic recession will encourage Albertans to turn to alternative financial services, especially payday loans.

“There is a unique vulnerability at the moment given the economic environment and predators take advantage of such vulnerability, so I do have significant concerns about an increase in the uptake of these loan products,” McLean told the newspaper.

Despite the fact that a majority of payday loan customers are low-income, it’s reported that oil workers, who made incredible livings just two years ago, are resorting to payday loans. A part of the reason is because they have usually maxed out their credit cards and lines of credit.

Last week, the Ontario Government announced that it would be accepting feedback from the general public regarding lower rates for payday loans and new consumer protections. Meanwhile, municipalities across the province are proposing their own regulations.

In the last few years, Canada has seen a surge in the number of payday loan businesses. With an estimated 1,400 stores now open, about two million Canadians take out a payday loan per year. Critics say it places consumers at risk of being deeply indebted, while proponents present the case that there is a demand for payday loans and it helps those without access to credit.

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College grads clueless about credit

There are many college graduates who would like to believe that they are pretty savvy when it comes to finances. However, a recently released report indicates that many students know very little about important financial matters such as credit scores – something that could prove damaging to them in the future, as they may fail to understand the importance of building and maintaining a good credit score.

A study was carried out recently by a student loan group, LendEDU, which showed that more than 50 percent of college grads that they surveyed did not really know what a credit score was. Given the increasing importance of having good credit, this spells bad news for those who lack awareness of credit ratings and how they work. It is made all the worse by the fact that college graduates are the group that will most likely need to get credit in the coming few years in order to purchase a home, buy a car, and make other major life purchases.

College Graduates Have No Clue About The Importance of Building Credit

Experts have expressed concern over the lack of awareness that many college graduates have when it comes to credit ratings and finances in general. They are now urging recent graduates to take steps to build their credit so that they can enjoy a brighter financial future. They have also advised students to take time to learn about how credit scoring works and how it can impact upon their future, as this will then enable them to realize the importance of keeping a clean credit file.

One of the things that officials are advising college grads to do is to take out a secured credit card and then use it sensibly, wherever possible repaying the balance in full each month. This will enable graduates to prove their creditworthiness as well as build a solid credit profile. By repaying the balance in full they can also avoid having to pay interest on the balance.

One expert also said that graduates need to make sure they keep their utilization rate in check, and should ensure that they never use more than 30 percent of their available credit. This will help them to avoid falling into unmanageable debt and will show other lenders that the borrower is savvy enough to only borrow what he or she can afford to comfortably repay. This also makes it easier to avoid missed payments through lack of funds, which could otherwise adversely affect the credit score. 

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