Citi Credit Card Rewards Responsible Action (Part 2)

By Michael Killian, CardRatings.com Reporter

Editor's Note: This article is the second of a two-part interview with Terry O'Neil, Executive vice president of Citi Cards.

Mike: Can you elaborate on some of the benefits of this program?

Terry: Citi Forward has great built-in features and benefits that include:

• Quarter percent purchase APR reduction when making a purchase, staying under the credit line and paying on time three billing periods in a row.


• 100 ThankYou Points each billing period for paying on time and staying under the credit line.


• 5 ThankYou Points for every $1 spent on restaurants, books, music, and movies; 1 ThankYou Point for every $1 spent on other purchases.


• No annual fee.


• Citi Forward by MySpace: 100 ThankYou Points for completing each chosen socially responsible act.

Citi Forward also offers a variety of credit education and online features to help keep card members' credit healthy:

• Spend Tracker: a simple, easy-to-use online tool that estimates their categorized spending and shows how it stacks up against others.


• Custom bill dates.


• Monthly statement that breaks down spending into categories to quickly see where money is being spent.


• Email or text alerts when payment is due, approaching the credit line, payment notifications, and more.


• Free credit education tips and interactive tools at www.usecreditwisely.com

Mike: What type of response are you getting from consumers on this program?

Terry: It is still quite early, but we are very pleased with the response to Citi Forward so far and the level of engagement we're seeing from consumers. For example, already more than 3,300 MySpace users have completed socially responsible acts through the 12 Resolutions Program.

Having designed a card specifically with consumers needs and concerns in mind, we think they will find a great deal of value in the many ways this card can benefit them.

Mike: Will CitiForward.com and Citi Forward's MySpace site have additional information forthcoming and will it be continuing for the foreseeable future?

Terry: We continue to look for ways to engage more deeply with our customers and consumers. Every 90 days we will feature 3 new socially responsible deeds as part of the on-going 12 Resolutions Program.

Mike: Are there any special requirements to become part of this program?

Terry: We invite all consumers to apply for Citi Forward and Citi Forward by MySpace. Also, all MySpace users are invited to participate in our 12 Resolutions Program.

Mike: Is there anything you would like to add?

Terry: Citi Forward was designed specifically with consumers' needs in mind. Citi Forward goes above and beyond other programs to reward responsible financial behavior, help consumers maintain healthy credit, and make credit education an inherent part of being a card member. The opportunity to earn purchase APR reductions and receive ongoing credit education provides consumers with the foundation to build and maintain a strong credit history and financial future.

What do you think about this new Citibank product and credit card issues in general? Would love to see your comments and questions on our active credit card forum.

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This article was written by Mike Killian, Founder of Learning Credit and Debt Management. Mike has been writing about credit and debt management issues that are of importance to consumers for over 8 years. His articles have been referenced by various members of the media, including MSNBC and The Motley Fool. Mike has also offered debt elimination seminars to businesses and community colleges for many years.

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CardRatings.com is the most comprehensive source for comparing credit card offers. CardRatings.com is pleased to offer consumers free credit card ratings.

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Please Note! You are welcome to republish this article as long as you state that CardRatings.com is the source for the article. You must also include a link to our website if you republish the article online. Click here for more details about using our articles and thank you for your interest!

Citi Credit Card Rewards Responsible Action (Part 1)

By Michael Killian, CardRatings.com Reporter

Editor's Note: This article is the first of a two-part interview with Terry O'Neil, Executive vice president of Citi Cards.

Who hasn't ever paid a credit card late fee? Consumers are often penalized with over the limit fees or a higher interest rate for being late on a payment. Wouldn't it be great if there was a credit card company that offered rewards like a lower APR for acting responsibly? Citibank is a company who is attempting to do just that. Terry O'Neil, Executive Vice President of Citi Cards, explained a unique, new rebate credit card called Citi Forward.

Mike: Can you offer background information as far as what Citi Forward is all about, details of its rewards programs, and why it was initiated?

Terry: Citibank conducted extensive qualitative and quantitative research into the wants and needs of consumers and found that they wanted a credit card that rewards them for good financial behavior. Citi Forward was built from the ground up, in response to these findings, to help consumers build and maintain a good credit history.

Our research revealed:

• 74% said they would very interested in a credit card that rewards them for good financial behavior


• 76% agreed that they would rather learn by being rewarded for doing the right things they do, rather than learning from mistakes


• 82% said they can do a better job managing their finances

Citi Forward speaks directly to the financial needs and interests of consumers and rewards them for making the right decisions when it comes to credit. Citi Forward is the only credit card that lowers card members' purchase interest rate by a quarter percent when they use credit wisely and rewards them with ThankYou Points each billing period for paying on time and staying under the credit line. The long-term reward is the foundation to build and maintain a strong credit history and financial future.


Mike: Can you elaborate in detail on the credit card APR reduction feature you mentioned?

Terry: Uniquely designed to help consumers maintain healthy credit, Citi Forward is the only credit card that lowers a card member's purchase APR by a quarter percent when they make a purchase, stay under the credit line, and pay on time 3 billing periods in a row. The purchase APR can be reduced a maximum of 8 times up to a total reduction of 2% throughout the time the account is open. The APR reduction does not apply to balance transfers or cash advances.

Mike: What is the difference between Citi Forward and Citi Forward by MySpace?

Terry: Citi Forward and Citi Forward by MySpace are both designed to help consumers build and maintain healthy credit.

The latter uniquely rewards card members for both financial and social responsibility, while offering great exclusive rewards and experiences through MySpace. Card members receive the same benefits and incentives for using credit wisely as well as the opportunity to earn additional ThankYou Points for completing socially responsible acts as part of the card's 12 Resolutions Program. These deeds include donating to a local food drive, going paperless, switching to energy-efficient light bulbs, and more.

Citi Forward includes free membership in Citi's ThankYou Rewards Network. ThankYou Points can be redeemed for millions of items, including a wide range of merchandise and experiences, such as gift cards at leading retailers, travel, student loan rebates, charitable donations, and much more.

Citi Forward by MySpace cardmembers can also redeem ThankYou Points for exclusive rewards and experiences from MySpace, such as music downloads, the Impact Maker Fundraising package, VIP concert experiences, private concerts for card member and friends in a small venue, trips to movie premiere screenings, trips to a charity gala, and much more.

What do you think about this new Citibank product and credit card issues in general? Would love to see your comments and questions on our active credit card forum.

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This article was written by Mike Killian, Founder of Learning Credit and Debt Management. Mike has been writing about credit and debt management issues that are of importance to consumers for over 8 years. His articles have been referenced by various members of the media, including MSNBC and The Motley Fool. Mike has also offered debt elimination seminars to businesses and community colleges for many years.

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CardRatings.com is the most comprehensive source for comparing credit card offers. CardRatings.com is pleased to offer consumers free credit card ratings.

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Please Note! You are welcome to republish this article as long as you state that CardRatings.com is the source for the article. You must also include a link to our website if you republish the article online. Click here for more details about using our articles and thank you for your interest!

Using a Low-Rate Credit Card to Your Advantage

An excerpt from How YOU Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line.


The three Keys to Using a Low-Rate Credit Card to Your Advantage:

1. Make your payments early.

If your card issuer uses the average daily balance method to calculate interest (most do), make your payments before the due date to reduce the interest bite. According to Nancy Castleman, cofounder of GoodAdvicePress.com, lenders are required to credit your payments when they are received, so the earlier you pay your credit card bills, the lower the average daily balance will be. The less you owe, the more you’ll save in interest. Bottom line: To save the most, pay as early as you can-and as often as you can, for that matter.

2. Avoid the dreaded default rate.

With any card, particularly a low-rate card, make sure you always do the following:

• Make your payments on time.


• Never exceed your credit limit.


• Don’t write a check for payment that is dishonored.

Otherwise, you might end up getting hit with a default (aka penalty) rate, which is normally much higher and can be over 30%. Ouch!

You should know the default rate of your current cards and any cards that you’re considering. (Check the Schumer Box.) Perhaps more important, pay attention to what can trigger the default rate.

Especially if you can’t trust yourself to follow my tips to avoid a rate hike, look for the lowest default rate you can find. Some smaller card issuers, such as Simmons First National Bank in Arkansas, offer default rates in the mid-teens, while the average default rate in 2007 was 24.51% according to Consumer Action.

Finding out what triggers the default rate can be a challenging proposition because this information is not normally adequately disclosed. Fortunately, you can easily search default rate triggers by perusing the New York Banking Department’s quarterly online survey.

One worst-case scenario should encourage everyone to pay their bills on time: Some lenders charge a default rate if you’re only one day late making one payment. Other issuers institute a penalty rate if your monthly minimum payments are late twice in any portion of a 12-month period. Exceeding your credit limit is also a common default pricing trigger.

Finally, those late payments with other creditors, or even late payments to utility companies can result in default pricing. That controversial universal default clause can cost you money here, too, as can that lovely phrase, “anytime for any reason.” That’s where issuers can raise your rate strictly based on information in your credit report or a change in your credit score (more on this practice later).

Already paying a default rate? Find out what you have to do to get your account changed to a lower rate. Some lenders require you to make 6 or 12 consecutive on-time payments before the rate returns to the normal purchase APR. But the policies vary greatly.

3. Consider credit score implications.

Every time you apply for a new account, your credit score usually drops a few points. As a general rule, I recommend that you don’t apply for more than one new account every 6 to 12 months.


A similar question that I am frequently asked is, “How does taking advantage of multiple balance transfers affect my credit rating?” View points on this vary from “Risky” because of all of the open credit accounts that it produces, to “It really doesn’t change things much.” The general consensus among experts is that you credit ratings will not be adversely affects…as long as you do not do so excessively. In fact, some experts, including myself, maintain that “balance transferring” can actually improve your credit rating, at least in some instances.

More important, be careful not to use most of the credit limit on any of your cards (commonly called maxing out a card). Doing so really causes your credit rating to suffer. Ideally, you want to use only 10% or less of your credit limit. The higher your utilization, the more your score will suffer.

Finally, never make a late payment-never! Not only will this affect your credit score (generally when you are 30 days or more late), but as I’ve already showed, just one late payment could raise your low rate to exorbitant levels. And if you have more than one card, that single late payment can have a domino effect, with your other cards hiking up your rates.

For more tips on using low-rate credit cards, and other valuable credit card tips, check out Curtis' new book, How YOU Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line.

This article was written by Curtis Arnold, a nationally recognized consumer educator and advocate. Curtis has been educating consumers about credit cards since 1998. He is regularly interviewed and quoted by respected members of the national press regarding consumer credit issues. His new book, How YOU Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line is available now! Order online and receive up to a 37% discount.

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CardRatings.com is the most comprehensive source for comparing credit card offers. CardRatings.com is pleased to offer consumers free credit card ratings.

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Please Note! You are welcome to republish this article as long as you state that CardRatings.com is the source for the article. You must also include a link to our website if you republish the article online. Click here for more details about using our articles and thank you for your interest!

Negotiate a Better Credit Card Rate

An excerpt from How YOU Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line.


When you've taken a gander at the current rates being offered, you can use them as a negotiating tool with your card issuer. Trying to bargain down your rate might sound like an intimidating, complex process, but it's actually quite simple and can be very empowering as it saves you money. Believe it or not, many consumers have saved hundreds and even thousands of dollars by simply making a five minute phone call and asking their issuer to lower their rate.

Unless you already have a great rate, it's definitely worth calling your lender to see if you can get a better deal. I've done this myself many times over the years, so I know that it works. However, your chances of succeeding are significantly diminished if you have a poor credit rating or you haven't used your card responsibly (for example, you've had more than one late payment in the past year or you exceed your credit line on a regular basis).

Here are five tips to increase your chances of getting a lower rate when you talk to a customer service rep:

1. Always be courteous and professional.
2. Say that you're keenly aware that there are better offers available to you. Mention specific low-rate offers from other card issuers.
3. Point out your good track record and your good credit score.
4. Explain that you'd like to continue to use the card - and plan on doing so - if your rate is lowered.
5. If the answer is "No," politely ask to speak to a supervisor, and repeat steps 1 through 4.

Talking to a supervisor is often worth it because the customer service reps are more limited in their ability to make account changes. If the supervisor can't help, you next step should be to threaten to stop using the card and to transfer you balance elsewhere. When you call their bluff, you'll probably be transferred to the account retention department. Its sole purpose is to keep customers (hence the name), so this department can often give significant concessions to make you happy.

For more tips on how to negotiate a better rate, and other valuable credit card tips, check out Curtis' new book, How YOU Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line.

This article was written by Curtis Arnold, a nationally recognized consumer educator and advocate. Curtis has been educating consumers about credit cards since 1998. He is regularly interviewed and quoted by respected members of the national press regarding consumer credit issues. His new book, How YOU Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line is available now! Order online and receive up to a 37% discount.

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CardRatings.com is the most comprehensive source for comparing credit card offers. CardRatings.com is pleased to offer consumers free credit card ratings.

---

Please Note! You are welcome to republish this article as long as you state that CardRatings.com is the source for the article. You must also include a link to our website if you republish the article online. Click here for more details about using our articles and thank you for your interest!