Easy Prey2 Sep 2020

Managing Credit Cards with Sara Rathner

Long gone are the days of companies giving away coolers on college campuses when students would sign up for high-interest credit cards. Unfortunately, there are still sneaky promotions, fine print, and ways these companies take advantage of unsuspecting customers.

Our guest today is Sara Rathner. Sara is a NerdWallet travel and credit cards expert. She appeared on the Today Show, Nasdaq, and CNBC's Nightly Business Report and has been quoted in Yahoo Finance, Time, Business Insider, and MarketWatch. She's held a total of 23 credit cards using travel reward points to see the world on a budget. A proud Northwestern University alum, she also has a certificate in financial planning from Boston University. She's here today to talk about personal finance scams and how to manage your credit cards.

Show Notes:

[1:40] - Sara's passion is personal finance and people reach out to her to ask questions. She really wants finances to be empowering and not scary.
[3:04] - Chris remembers the days when he was in college seeing booths of credit card companies setting college students up with credit cards. Sara explains the Card Act that changed the law to protect young adults.
[4:31] - There are times when your credit limit can really help you in a bind.
[5:10] - Sara recommends everyone read the fine print of every credit card you apply for, even though it is not enjoyable to do so. You can find all this information before you even fill out an application.
[6:06] - You want to find a card that provides greater value than its annual cost. You want to find a card that has rewards that you will actually redeem and use.
[6:32] - The credit card industry is seeing a lot of change due to the pandemic.
[7:29] - Sara explains how revolving credit accounts work and where credit card balances can get dicey.
[9:14] - If you pay your credit card bills every month rather than the minimum payment, you won't deal with interest.
[10:00] - Chris shares an experience of reading the fine print on a store credit card application that claimed to be interest-free for the first 12 months. Sara confirms how that works and cautions people to know that fine print.
[12:30] - Interest rates are negotiable to an extent.
[13:11] - Missing a payment is huge. Many cards have late fees and a late payment could hit your credit score by 100 points or more overnight.
[14:05] - The thing that you need or want now is great, but if it causes you long term financial struggle, oftentimes it wasn't worth it in the first place.
[15:23] - Sara recommends for those really large purchases to save up money rather than taking on the stress of debt if you can.
[16:30] - There are a lot of recent scams, specifically small business loans and unemployment insurance, that are popping up after the pandemic caused people to lose their job and reliable income.
[19:05] - Sara recommends going directly to the government agencies that offer financial assistance during this time and never to go to an outside source no matter how legitimate they appear.
[20:58] - Sara shares an experience with a credit card company contacting her about a problem with her account and asked her for her credit card number to verify. She refused and called the number on the back of her card to make sure.
[23:13] - Any time you are trying to buy and sell items on platforms like Craigslist and Facebook Marketplace, be very careful because there are scams there, too.
[26:07] - It is much more important to be careful and seem paranoid than take a risk. You're dealing with strangers so their opinion doesn't matter.
[28:06] - Chris and Sara discuss sketchy ways scammers try to snag you. But there are legitimate credit repair resources online and many of them are free. NerdWallet is an excellent resource.
[29:49] - It takes a few months for positive behaviors to show up on your credit reports, so if you stick with it you will be rewarded.
[30:27] - NerdWallet is your financial best friend that has tons of great articles and calculators. Check out the app and website.
[31:01] - Sara shares her most valuable piece of advice for those who think they have been a victim of a scam, including a website to report potential scams.

Thanks for joining us on Easy Prey. Be sure to subscribe to our podcast on iTunes and leave a nice review.

Links and Resources:

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