Distressing debt figures

The debt figures, particularly the amount owing as cash advances, are a real worry...

 

http://www.dailytelegraph.com.au/money/money-matters/aussies-face-avalanche-of-cash-advances-on-credit-cards/story-fn300aev-1225879295178

 

 

Banks should be ashamed!

Article in today’s SMH... For Commonwealth Bank, 63 per cent of workers reported the debt-selling pressure, while 53 per cent of Commonwealth Bank-owned Bankwest employees reported the focus....

 

http://www.smh.com.au/business/bank-workers-fret-over-customer-debt-20100609-xudq.html

Retailers fighting for market share with credit cards

Retailer-branded cards are fighting for market share from other credit cards, but are they worth comparing? RateCity investigates.

May 27, 2010

We are constantly bombarded with options for both credit cards and store cards -just open up your letter box for promotions on credit cards or walk through your favourite department store where someone is bound to hand you a flyer about their store card. But how do you know which is the better card for you?

What's the difference?
Both types of cards offer customers with an opportunity to buy now and pay later; however there are a few unique differences between the two.

A credit card is a plastic card with a magnetic strip that people obtain through financial institutions to purchase goods and services as well as withdraw cash. They are issued with credit limits and both purchases and cash withdrawals incur interest rates. Some also provide points for spending money on the card.

A store card is similar to a credit card in that it is used to purchase items on credit however they can only be used within a particular store or range of stores, for example the Myer Card can only be used at Myer stores and charges a high 21.99 percent per annum at the time of writing.

But as our love of credit cards grows some larger retail chains are upgrading their store cards to offer a credit card with Visa, MasterCard of American Express so that you can use them anywhere which means more often. The GE Money Coles Group Source MasterCard, David Jones American Express Credit Card and Woolworths Everyday Money Credit Card are some examples, you can use them virtually anywhere and there are often bonus promotions for using the card at the card's branded retailer.

So how to choose which type of card?
With so much choice, here are six tips to follow that may help you in deciding which card is best for you and your lifestyle:

1.     Compare credit cards online to find a credit card that offers a low interest rate and more rewards.

2.     Look at the reward programs on offer and see which one will suit your spending habits.

3.     Look at the way you shop, if you regularly shop at one store and it offers a store card or credit card perhaps look at the benefits you will receive versus a standard credit card.

4.     Look out for a card that offers longer interest free days which gives you a period to pay back the balance of your card without paying extra.

5.     Look for a card that is more readily accepted so you won't be limited to where you shop.

6.     Does the card charge an annual fee? If you don't pay off your balance in time each month it may be worth paying an annual fee to receive a lower interest rate.

Dave Ramsay's take on Bankruptcy

The Truth About Bankruptcy

from daveramsey.com on 03 Aug 2009

Myth: I'll just file bankruptcy and start over; it seems so easy.
Truth: Bankruptcy is a gut-wrenching, life-changing event that causes lifelong damage.

Bankruptcy.

That word sends chills up the spine. If you're facing the prospect of bankruptcy or in the middle of it right now, you know it's a living nightmare. It can devastate your job, destroy your marriage and steal your peace of mind.

Kathy called my radio show ready to file bankruptcy. Her debts were overwhelming, and her cheating husband had left with his girlfriend. The house was in his name, as was all the debt except $11,000. Kathy was 20 years old, and her brilliant uncle—a lawyer from California—told her to file bankruptcy. Kathy was beat up, beat down, and deserted without help, but she was not bankrupt. When her soon-to-be ex-husband ends up with all the debt in his name, he may be bankrupt, but Kathy won't be.

Why Avoid Bankruptcy?

Bankruptcy is not something I recommend any more than I would recommend divorce. Are there times when good people see no way out and file bankruptcy? Yes, but I will still talk you out of bankruptcy if given the opportunity. Few people who have been through bankruptcy would report that it is a painless wiping-clean of the slate, after which you merrily trot off into your future to start fresh.

Don't let anyone fool you. I have been through bankruptcy and have worked with bankruptcy for decades, and it is not a place you want to visit. Bankruptcy is listed in the top five life-altering negative events that we can go through, along with divorce, severe illness, disability, and loss of a loved one. I would never say that bankruptcy is as bad as losing a loved one, but it is life-altering and leaves deep wounds both to the psyche and the credit report.

Types of Bankruptcy

Chapter 7 Bankruptcy, which is total bankruptcy, stays on your credit report for10 years. Chapter 13 Bankruptcy, more like a payment plan, stays on your credit report for seven years. Bankruptcy, however, is for life. Loan applications and many job applications ask if you have ever filed for bankruptcy. Ever. If you lie to get a loan because your bankruptcy is very old, technically you have committed criminal fraud.

Most bankruptcy cases can be avoided with proper help, such as our certified counselors and the Total Money Makeover. Your Total Money Makeover may involve extensive amputation of stuff, which will be painful, but bankruptcy is much more painful. If you take the thoughtful step backward to get on solid ground instead of looking at the false allure of the quick fix that bankruptcy seems to offer, you will win more quickly and easily. I know from personal experience the pain of bankruptcy, foreclosure, and lawsuits. Been there, done that, got the t-shirt, and it is not worth it.

Rise in middle-class bankrupts

DANIELLA MILETIC - SMH

May 24, 2010

PROFESSIONALS and people on high incomes are declaring bankruptcy faster than ever in Australia, according to a study that reveals bankruptcies have risen by more than a third in the past four years.

The report contradicts the common belief that most people who file for bankruptcy are either chronically poor with no other options or the hugely wealthy avoiding debt obligations.

Bankruptcy is increasingly becoming a ''middle class phenomenon'' in Australia, says the report from the University of Melbourne Centre for Corporate Law and Securities Regulation.

Professor Ian Ramsay, an author of the report, which will be published later this year, said the number of personal bankruptcy filings jumped by 6 per cent in 2008-09, after rising steadily over the past four years. There were 27,520 in 2008-09, an increase of 34 per cent since 2004-05, when there were 20,501 cases of bankruptcy. In 2009 the number of personal insolvency cases (which mainly involves bankruptcy but includes debt agreements) shot up to 36,487.

In an earlier study Professor Ramsay and his co-author, Cameron Sim, found that since 1990 there had been a 300 per cent increase in the number of personal insolvencies in Australia, far exceeding population growth and indicating a strong middle-class presence.

In their recent report Personal Insolvency in Australia, they have focused on middle class bankruptcy profiles. ''There are so many urban myths about bankrupts … students skipping on credit card bills, wealthy hiding assets who prefer to go into bankruptcy,'' Professor Ramsay said. ''They exist but are not indicative of the typical bankrupt.

''One of the biggest findings was that more and more of the middle class are being claimed by bankruptcy and, to us, it seems a social problem that has escaped notice.''

Because the phenomenon of the middle class bankrupt is so unheard of, Professor Ramsay said that Australians were largely unaware of the social costs to those affected, which includes tarnished credit ratings, difficulty in the workforce, cost to personal relationships and the still-prevalent stigma attached to becoming bankrupt.

He said insolvents are increasingly from higher-status occupations, have higher levels of personal and household income, and have rising asset and property ownership levels.

A major cause of rises in bankruptcy among the middle class, said Professor Ramsay, has been due to unsustainable home loans. Excessive use of credit as a cause of bankruptcy has jumped significantly in recent years, he added.

June interest rates steady

Thank goodness interest rates didn’t go up again... not only do they affect your mortgage but they also bump up your credit card repayments...!

Australia's ANZ bank profit jumps 36 percent

Outrageous profits by ANZ Bank yet again... when is the government going to realise that the banks should not be listed on the stock exchange, because of a massive conflict of interest.