Screw Me? Screw You!
While this shouldn't be a revelation, I'll share it anyway: credit card companies never have been and never will be our friends.
And after a long, hard trip learning the true value of a dollar and spending years correcting bad credit mistakes, it looks as though that work will have been for nothing. And if there's one image in my mind that sums up the entire economic mess—whether financial, investment, banking or credit institutions—it's that of someone holding a gun to my head telling me: "Either way, you're gonna pay."
I have spent the last several years assiduously paying every bill on time, organizing my finances so that I had a plan for trimming all the fat and setting a target goal of having outstanding debt of about 8% of my yearly income. My car is paid off. My student loans are paid off. One by one, balances were zeroed out. I took advantage of zero percent cards, moved high balances over and carefully plotted out when the last of them would disappear. Every big ticket item I've purchased was money I saved up: I rarely use my cards. I did precisely what everyone said I should be doing.
Now that the credit card companies are faced with reform, they're all complaining loudly that they have to make up the money somehow, and guess who's going to get hit? Those who pay their bills on time. Those who have learned their lessons and know exactly where their money goes and how much of it they have. People like me.
Truthfully, I am not surprised. It's been apparent to me for some time that I will be one of the many people who will never own a home and never get a break due to bad timing. When a banking institution looks at my application for a home loan, all the bad practices of high-risk people will hurt me, as will the greed and anger of credit card companies who are determined to screw as many people as possible to keep their business model going strong. But because it's no shock that businesses have to make up lost revenue somewhere, what else can I do? Our system is rigged so that you need credit. The more debt you owe, they more they like you because of all the fees they can charge you. The less debt you owe is no longer a virtue in our society because that's less money they can make off you, not the sign of a good loan risk because you're a person who can manage his debt. Our system encourages reckless spending and borrowing. Now that the president will sign a bill demanding shady practices end, the credit card companies will only change targets. There is no reform here, because the fundamental attitude isn't changing at all.
To whit: I had a card last year with a $1500 balance on a $2000 line of credit. According to my plan, it was paid off well before the introductory zero percent rate was up and the card lay unused for over nine months. Just to keep it active, I made a $40 purchase, and within a couple days, logged onto the company's Web site to schedule a payment. Imagine my surprise when I discover my credit limit has been lowered to a measly $340. After writing a letter and waiting for a response, I learned that my account was one of many in a "sweep" of reviews and that as a result, my credit limit was lowered. Thank you, have a nice day.
I canceled the card, but the damage was already done. When a bank looks at my credit report, they're going to see that the limit on one of my cards was lowered: is there any other way for the loan officer not to see as it a strike against me? Absolutely not. Even if I am asked for an explanation, the reason will be so vague and unconvincing that it may not be worth trying. The credit card company, seeing I had no balance, knew it couldn't make any money off me by raising my interest rate: I can't help them, they won't help me, hence, the lower limit. And this was before the credit card reform bill passed both houses of Congress.
So, there's my image of our economic system: a gun to my head. Your money or your life. The only answer I have is to accept wholeheartedly that the system is rigged against me. While I currently have two credit cards with balances, they're set to be paid off this year, although not before the respective companies take out their revenge with new fees, higher interest rates and holding me hostage. But honestly, I'm not angry. In fact, you could say I'm non-nonplussed. Credit cards are an evil thing: the lure of easy money has contributed to our economic meltdown in ways that most people don't understand. And I admit that I'm tempted to just throw caution to the wind and charge what I want because I will never be able to get ahead. But in a more lucid moment, I would say to get rid of your credit cards except one and save up for just about everything else. If there's any silver lining to this entire mess, it could very well be that enough people have decided to get off this roller coaster ride and refuse another trip.