As if we weren’t paying high enough, a recent settlement by large credit card conglomerates have left us open to an additional charge for using a credit card. What? Yes, you could be officially paying for the merchant’s processing fees (ranges between 1.5% to 3.5%) if you were to use your credit card for the purchase?

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Are we going back to the green bills? Not yet, but you must be aware of the fact that some merchants may be imposing a surcharge for credit card use. What is a processing fee? Well, you may not be aware but every time you swipe your credit card, the business that is selling you the merchandise coughs up around 1.5% to 3.5% of the purchase price as processing fees. That’s what it takes for the merchant to route the funds to a payment processor and get it deposited into its bank account.

Wait, but why I should I pay the “credit card extra charge”?

Well, that is the multi-billion dollar question where lobbyists, small business owners, consumers, and large players have been clashing for a very long time. Finally, a multi-billion dollar settlement was reached that would allow businesses to pass on the costs of their processing fees as extra charge for credit card use or a surcharge.

Time will tell if the practice will prevail but for now it is being hailed as a victory by those who pursued the initiative.

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Small businesses ask us: Can I charge customers for using a credit card?

Well, you would have to update yourself on current regulation, but in our opinion it is a bad business practice. Sure you would be passing on the extra costs associated with credit card use but by mandating a charge for using a credit card, you will be putting off your customers, limiting the use of credit cards (and hence total spend at your business), and even losing your customers to competing businesses that don’t pass on the extra costs to their customers.

Think about it again, seriously.

What merchants still cannot do (charge for using credit card)

In many states, merchants cannot push for a minimum spending amount if you want to use a credit card. Also, store owners (and other businesses) that accept credit cards cannot charge extra for credit card use in an amount over the processing fees. If you suspect that a merchant is lining up his bank account by collecting unreasonable surcharges, contact your local authorities and consumer protection bureau officers.

It is quite possible that you may already be paying these fees and not know about it. Businesses often use a variety of tricks to raise their prices and label them under different categories to make up for the lost profits and circumvent regulatory sanctions. But until recently, they could not label these surcharges as an extra charge for credit card use. Now they can, but within limits.

What you, as a customer, can do

As a customer, you can voice your concerns with the merchant, avoid shopping with the merchant that imposes a credit card surcharge (if a reasonable alternative is available), use other forms of payment, or shop for businesses online. It is much easier to do comparison shopping online.

You can also file a complaint against a merchant who imposes unreasonable fees as extra charges for credit card use.

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Rewards points could be a collector’s best friend but also a procrastinator’s worst nightmare. One mistake and you could end up losing years of work and a collection of tens of thousands of points in an instant. Ouch! We have heard horrifying stories from the collectors who lost thousands of points simply because they did not pay attention to the expiration dates.

Rewards points are a great motivator for many of us who prefer to spend a dollar and gain something back in return. We will share some expert strategies and tips to collect and redeem your rewards points. Let them grow!

Click here to find and compare credit cards that offer rewards, points, and other bonuses to loyal customers. Some offer 0% intro APR.

For first timers, we will first explain what a reward point is and how it works

Companies offer rewards points in a bid to foster loyalty and repeat purchases. Customers, on the other hand, stand to gain from deep discounts, loyalty rewards, and other benefits when they redeem the points. These points make sense, especially if you like the brand and prefer to work with the same company over and over.

From retailers and credit card companies to hotels and airlines, rewards points are offered by millions of companies in a bid to foster repeat purchases. Companies offering rewards often use different terms, such as discount cards, points card, loyalty card, advantage card, club card, and other similar variations.

A customer simply needs to present the card to either accumulate the points (on every purchase) or receive discounts and special deals.

How to collect rewards points?

Generally, you accumulate rewards points automatically. For every dollar you spend on your shopping, the system would automatically add a few points to your membership account. The system varies depending on how the program is setup. Certain programs are setup to award you one point for every dollar spent, others may double the number of points, while still others offer fewer points on every dollar spent.

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How to redeem your rewards points?

Redeeming rewards points is not hard. When you accumulate a certain number of points, you need to notify your provider as to the number of points you have accumulated. In case of retailers, you would just need to visit the store and exchange your points for items you can purchase with the points. Some companies provide online accounts where you can manage and redeem your rewards.

What about travel rewards?

Some companies, especially credit cards and airlines, offer travel rewards wherein you accumulate a certain number of points for the amount you spend. When the total points reach a higher figure you can either obtain discounts on your next trip or book a ticket with another airline from the company’s website. If you accumulate a substantially larger number of points, you can even fly free ($0).

Where to redeem the rewards points

Usually the company’s website would be the best place to start but in case of retailers a store location would do the job as well. Most consumers prefer the convenience of an online redemption policy.

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Advantages of rewards programs and points

– Receive special prices and percentage discounts that are reserved exclusively for loyal customers.

– Receive preferred customer service

– Get a preference, at least where priority tickets and purchases are concerned

Rewards points dos and don’ts

Dos

– Track your spending and your points

– Use online services that would do all the work for you

– Read the fine print to maximize your purchases and your points

Don’ts

– Don’t spend just for the sake of collecting the points

– Don’t ignore expiration dates and redemption policies

– Don’t ignore guidelines for purchases and points

How does a company/brand benefit from rewards points?

First, they develop a loyal customer base. Customer may not be aware but they are truly priceless for any company/business that is serious about its bottom line. Cost Per Acquisition is the term used to indicate the cost of acquiring a single customer and in many industries this cost could run in the hundreds or even thousands of dollars. By fostering loyalty and offering discounts, companies can benefit from a loyal customer base and reduced marketing spend.

In addition to the direct financial benefit, when a customer signs up for a rewards program, there is a clause that allows marketing departments to track purchase patterns and send extremely targeted marketing messages and promotions. This strategy further boosts the sales funnel and impacts the ROI in a positive manner.

Click here to find and compare credit cards that offer rewards, points, and other bonuses to loyal customers. Some offer 0% intro APR.

In conclusion

Rewards points could be a great value-add tool for getting discounts, booking cheaper flight tickets, and getting something in return for the purchases you make. One caveat, though, carefully monitor both your spending and your program’s expiration and redemption policies. Some programs do not have an expiration date while others have much stricter guidelines.

DontSpendMore.com is a free site that allows consumers to compare offers and discounts and save hundreds of dollars on credit cards, long distance, Internet, and so much more. Click here to compare the Web’s best deals.

Reward Credit Card Reviews (card cash review)

I love the idea of spending a dollar on items I already need and setting aside a small percentage of it elsewhere, especially if all the work is done by an automated system or algorithm without my intervention. It wouldn’t be a wise choice to go splurge on a spending spree but using your reward card for items you already need (such as groceries, gas, travel tickets) wouldn’t be a bad idea.

Reward card offers several advantages (and some unwanted features as well). In our reward credit card reviews, we will focus on some basic features you should be looking and also warn you about unwanted ones that you should try to avoid as far as possible. Further, we have dedicated a special page to a review of the best credit reward credit cards (including points, card cash back, and travel miles).

Click here to see the reward credit cards that made it to our top cards list

Reward card review

Reward cards provide a variety of bonuses:

Cash back: A certain percentage of your spending will receive a reward in the form of cash back bonus).

Points: For every dollar you spend, some credit card companies will offer you a certain number of points. The ratio varies. At the lower end, it could be one point for every dollar spent while at the higher end it could be much higher and you could receive several points. Furthermore, when you sign up for a reward credit card, your account will be awarded a sign-up bonus of X,000 points.

Where can you redeem these points? In most instances you can redeem the points for cash, other items, airline tickets, hotel deals, and more. Your agreement will dictate the terms governing these purchases.

Travel points: Just like the points described in the previous section, travel points can be redeemed as an exchange for airline flight deals, hotel discounts, car rentals, and more.   

Frequent flyer miles: If your credit card offers airline miles as a reward, you will receive miles in lieu of points. So, for every dollar you spend your account will show X number of miles as a bonus. I have personally managed to collect thousands of miles in the past. You can exchange the miles for a free (or discounted) flight deal.

Click here to see the reward credit cards that made it to our top cards list

We reviewed several reward credit cards and as a general overview, here’s what we like and dislike:

Reward card review Likes

– Generous reward points and bonuses

– Longer expiration dates

– Low (or $0) annual fees

Reward card review Dislikes

– High annual fees and APRs

– Restrictions on where and how you can redeem the rewards

– Unreasonable redemption policies

Card cash review

Cashback cards are a hit with our reviewers. What we love is the fact that every dollar spent generates some form of cash back. The percentage of cash back bonus could range from five percent to up to twenty percent. Who doesn’t like cash, right?

Conditions: Some credit card companies will set aside the cash back bonus for a selected category of purchases (such as gas, airline tickets, and others). Additionally, you may be required to buy on designated websites only. These policies are generally for the higher end of the cash back spectrum.

Click here to see the cash back credit cards that made it to our top cards list

Card cash review Likes

– Higher cash back bonus percentage (the cash back bonus ranges from 2% to 20%)

– $0 Annual Fee

– 0% Intro APR and a low APR thereafter

– Friendly redemption policies

– Longer expiration periods

Card cash review Dislikes

– Annual fees

– High APR

– Shorter expiration periods

– Redemption restrictions

– Purchase restrictions (such as purchase at XYZ location or site only)

What you should know

Most reward credit cards will set forth stringent expiration dates and redemption policies that must be respected in order to redeem the bonuses. Failure to do so may result in forfeiture of the rewards and your hard-earned effort. You will have to have to watch out for restrictions, such as the spending patterns that will earn you the rewards (categories and places).

Fortunately, you can track and monitor your rewards through an online interface provided by the credit card company.

What you should do

– Perform some basic analysis to determine the net gain, especially if the card charges an annual fee or comes with a higher APR requirement.

– Regularly monitor your credit card spending and points accumulation

– Keep tabs on expiration dates and redemption policies

– Know your terms and conditions thoroughly

What you should not do

– Sign up for the credit card just for the sake of rewards

– Rack up purchases to collect points or miles (not a good idea)

– Purchase items that you don’t need

– Neglect monitoring the points accumulated on your account

We hope you found our reward credit card reviews useful. If so, please let us know in the comments section.

Credit card temporary hold or authorization is a commonly-appearing item on most credit card statements. Sometimes, you will see a temporary authorization for items you may have checked out but not purchased. Customers often panic when they see a temporary hold, authorization, or pre-auth on their credit card statement, especially credit card users who review their online transaction histories on a daily basis.

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So, what is a credit card temporary hold (or temporary authorization, pre-auth)?

We will clarify the term with the help of an illustration:

Let’s say you visit an online merchant who sells Widget X for $20. You like the widget, add it to your shopping cart and go through with the order. The moment you enter your credit card information on the merchant’s website, the payment processor used by the business will place a temporary hold on your credit card account in an amount equivalent to the purchase price of the item.

In this case, a temporary authorization in the amount of $20 will be placed on your credit card account immediately.

At this stage, one of two things may happen:

The merchant may have setup the payment processing to “Sale”

If the merchant has setup his/her payment processing system to use a “Sale” parameter, your credit card will be charged in that amount immediately and your account statement will immediately show a purchase of $20. Despite the temp charge (pre-auth), a temporary hold will still be placed on your account until the merchant “Settles” the transaction with the processor — in other words, the merchant instructs the payment processing company to go ahead with the transaction. Once cleared, the temporary hold will be converted into a final charge that you will have to pay at the end of the month.

It is also possible that the merchant may have setup the payment processing system to “Authorize Only”

Every system would use different jargons (instead of “Sale” and “Authorization”) but the concepts are mostly similar, and the process somewhat uniform.

Some merchants prefer to review orders manually before they process and fulfill them. In this case, the merchant may just put a “credit card temporary hold” on your account until the order has been reviewed manually by an authorized representative at the company. Once satisfied, the merchant would instruct the payment processor to go through with the transaction. The process is called “Settlement”. At this stage, your credit card will be charged the amount of $20 (the purchase price mentioned in the preceding illustration).

If the merchant is not satisfied, however, the transaction will remain as an Authorization on your credit card statement. Sometimes, it could be in an undecided state for several weeks.

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How long does the transaction remain as a temporary authorization? When will the hold be removed?

If you decide to go through with the transaction, the temporary authorization on your credit card will remain until the payment settlement process is completed. While the duration ranges, an average could range from a few days to several weeks.

If you decide to cancel the order, however, before it is processed and settled, your seller may just “Void” the order (that is it won’t be submitted to the payment processing system) and the transaction will continue showing up on your credit card statement as a hold or temporary authorization.

It may remain in that status either until the next billing statement or a shorter duration depending on how your credit card company’s internal policies are defined. If the order has truly been cancelled you won’t be charged.

Why is my total credit line reduced by an amount equivalent to the temporary hold?

When a temporary authorization is placed on your credit card, essentially, the bank is setting aside the funds in that amount should the transaction follow through. To ensure the merchant is paid before you use your credit card for another process and exhaust your available credit limit, the credit card company will reduce your total available credit limit by an amount equivalent to the temporary authorization on your credit card.

You can liken the process to setting aside funds in a real world transaction.

Do I need to do something to remove the hold from my account?

Generally, there is not much you can do. The hold would be automatically lifted if the merchant doesn’t follow through on the transaction. Even if the hold is lifted, if you did purchase the goods or services from the business, it is possible for the company to follow through and convert the hold into an actual charge even after a few weeks. It occurs rarely, though, as the business would have to pay higher transaction costs to process a transaction that is relatively old.

What if I decide to dispute the transaction?

If the business has cheated you on the transaction or has engaged in otherwise unconscionable behavior, you could actually dispute the transaction and file for a chargeback. You can read our article about disputing a credit card transaction and filing for a chargeback.

Can I file for the chargeback while my credit card is on temporary hold?

Generally, no, because at the stage of a temporary credit card authorization, the transaction is not yet completed and fulfilled so you will have to wait until the process has been completed. Technically, as long as the amount is on hold, the merchant does not have your money so you cannot really take it back.

Can the credit card temporary hold (or authorization) be higher than the purchase amount?

The amount of the hold could be higher (or even lower). Some systems will place a hold in a nominal amount of $1, whereas other systems could set aside a much higher amount. Some gas stations, for instance, will place a temporary authorization in an amount as high as $90 even before you fill the tank. As soon as you complete the transaction, however, the station will charge the actual amount of your purchase price. These are safeguards merchants use to protect their interests.

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By Nimish Thakkar (c). Nimish is the founder of DontSpendMore.com. He holds two graduate degrees, including an MBA in Finance.

By David

If you have been considering getting a credit card, you may have been so overwhelmed by all the information that is out there to even know where to begin. In order to help you figure out how to get a credit card for free we’ll give you a few tips about things to watch out for and walk you through the typical application process.

Click here to get a credit card for free. Multiple offers, free comparison tools, rewards, and more.

Things to watch out for

Once you’re ready to start applying for credit cards you’ll want to remember a couple things to make sure that you get a credit card for free.

1)      Prepaid Cards – prepaid credit cards work on a different principle than a traditional credit card. Typically with this type of card, you’ll add money and then spend it, making it more like a gift card than a credit card. As this type of card costs money up front you will want to choose an option for another type of card.

2)      Balance Transfers – If you need to do a balance transfer when signing up for your new credit card, you will want to be sure this transfer does not have any associated fees. If it does, your application may end up costing you those fees upfront. In this case try to find an offer that does not include these associated fees.

3)      Annual Fees – While an annual fee will cost you nothing up front, it will charge you once you have had your card for a year. This is basically a charge just for having the card and will show up each year, whether you use the card or not. Do your best to avoid offers that include these fees.

Click here to get a credit card for free. Multiple offers, free comparison tools, rewards, and more.

The application process

Once you’ve identified an offer that looks promising you can get a credit card for free by applying and awaiting a response. Start by going to the webpage with the offer and clicking “apply”

1)      General Information – The first thing that will come up is a page for you to enter your information, such as name, address, age, and tax id information. Fill these fields out and continue to the next page.

2)      Employment Information – This field will ask about what you do for a living and what your average total annual income is. If you are living with others who are also working, you can add their income to this total. Enter the information in the appropriate places and move to the next page.

3)      Options – This page will typically ask a few questions about how you intend to use the card if approved and give you a couple options to choose from (such as paperless billing or express card delivery). Choose what you’d like (but avoid things with fees) and go to the last page.

4)      Terms and Conditions – This will present the terms and conditions for your approval. Look through them and click the check box acknowledging you agree.

Once you have done this you simply click “submit” to send them your application and then wait for their response.

Click here to get a credit card for free. Multiple offers, free comparison tools, rewards, and more.

By David

While it is not difficult to do a web search and find hundreds of credit card offers to apply for, finding one that is right for you and your situation can be a bit more challenging. There are so many factors to consider that you can get lost in all the information flying your way. To help, here is a step-by-step guide to help find you a credit card.

Click here to review multiple credit card offers in one place

Identify your situation

The type of credit card you should apply for depends on your present needs. A first year college student is going to want a different type of card than a retired investment broker or a single mother. Deciding in advance what you would like to use your card for is your first step to find you a credit card.

Card Types

Once you know what you would like to do with your card, you will want to take a look at the different card types and choose the one that is right for you. To simplify the process of finding me a credit card, the most common card types and a description of what they are best for is listed for you below.

1)      Prepaid Cards – Prepaid credit cards are like a store gift card, except that they can be used anywhere that a credit card from the same company is accepted. These cards are best used for those new to credit cards and for quickly getting money into another person’s hands (from a parent to a student for instance).

2)      Low-Interest Cards – A low-interest credit card is one that has an APR (annual percentage rate) of 10.4% or lower. These cards are good for balance transfers from higher interest cards, or for use as an emergency line-of-credit.

3)      Rewards Cards – Rewards cards offer you additional perks for utilizing the card and carry an average APR around 15%. Many will offer things like frequent flyer miles, donations to a charity of your choice, or cash back. These cards are best for short term borrowing (30 days or less) on the things you typically buy throughout the month like groceries or gas.

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4)      High-Interest Cards – High-Interest credit cards are those with an APR at 22% or higher and typically have low credit limits. These cards are designed to help those with bad or no credit repair any damage that has been done.

Match a Card Type to Your Needs

At this point all you need to do is pick the type of card that is right for your situation. Are you that first year college student we mentioned earlier? Maybe a prepaid card would be best so you can learn the system and get last minute help from your family quickly. Maybe you are that single mom. A low-interest credit card could get you out of a tight spot, or help reduce your other credit card bills. Whatever your situation, you can be sure that there is a credit card out there that is a perfect fit for you. Just decide which and apply.

Click here to review multiple credit card offers in one place