The credit card default rate in 2009 was the highest it’s been since 1991.  Also, in the last year, 15 percent of American adults, or nearly 34 million people, have been late making a credit card payment.  Due to the tough times we face, many cardholders have no other option but to miss one or more of their credit card payments.  But before they make the hard choice to do so, it’s important for them to realize that they may not only be damaging their credit score, but also sacrificing the benefits of their credit card rewards.

Though consumers are asking more questions about the ins and outs of the terms on their credit card accounts, most of the information that’s circulating around to satisfy these questions addresses finance charges and interest rates.  What about rewards?

If you haven’t received a notice from your credit card company that your rates are increasing, well, you probably don’t have a credit card. What some people are missing among the fine print is that many cards are changing their rate structure from a fixed rate to a variable one. So, what’s the difference, why is this happening, and is this a big deal?

According to the OCC, a fixed-rate credit card  means that the Annual Percentage Rate on the account “is not tied to an index that may change periodically.” Variable rates are generally tied to an index rate, such as the Prime Rate.

Given the upcoming holiday, I decided to do a light post about my favorite phone service. As we all know, there are plenty of heavy-hitters in the VoIP marketplace: Vonage, Skype, Google Voice, Magic Jack, Jupiter Jack, etc. But Vonage (VG) is the best of them based on my own subjective opinion. Here’s why.

First off, Vonage is different from its competitors because you do not need a PC to utilize it. Basically, you connect the Vonage box to a digital modem (either DSL or Cable), and then you unplug your regular phone from the wall and instead plug it in to the Vonage box.

Getting ready to shell out your hard-earned ducats for some holiday gifts? Here’s a round-up of what’ll be “in store” for the day after Thanksgiving. Click the store name to see the entire list of Black Friday incentives.

Best Buy: Twenty to 50-percent off many appliances, and a slew of digital camera offers that you can also access via eBay.

Lawmakers and the media seem to have dubbed greed as the primary evil responsible for the downfall of the American economy.  Insurance companies are routinely accused of greed, as are credit card companies and networks, investment banks, CEOs and so on.  In these times of economic hardship, when the nation’s economy is in desperate need of examination and revision, our federal policy makers are eager to put checks on greed in order to help fix the economy.   However, the truth is that in a capitalist economy, profits aren’t a sign of greed, they are a sign that a given company’s business tactics are successful within the competitive system in which that company operates.  If lawmakers think that specific companies are making too much money, then the problem isn’t corporate greed, it’s that there simply isn’t enough competition to keep those players from making excessive profits.  The President and Congress are determined to use their legislative powers to bail out the U.S. economy, but they ought to be concentrating their efforts not on greed, but instead on the lack of competition in the marketplace.

Instead, lawmakers have been continuously critiquing the profits of large companies, like those in the health insurance and credit card industries, attributing their successes to greed and greed alone.  The business practices of these companies are then regulated by numerous redundant agencies, creating enormous and costly bureaucracies that bog down the system and drive up prices.  In addition, they also create a system in which small companies cannot afford to compete with larger companies, and where companies operating within a single state are hampered by the regulatory costs and procedures that are associated with going national.

If you tuned in to “60 Minutes” on October 25th, you saw a segment detailing the extent of fraud committed against Medicare and taxpayers.  If you missed it, here it is:

Recently, I came across an article on Yahoo Finance detailing the similarities between our current economic market and the market of the 1929.  The author of the article, Simon Maierhofer, did a great job of summing up the ways our current economic crisis is paralleling the historical Great Depression and how our economic forecasters ought to rely more on history to help manage their expectations of buying opportunities and economic recovery.  I felt that Maierhofer’s observations were worth some commentary here at Wallet Blog and I wanted also an opportunity to point our readers over to his article for their own edification.

One of the key points that Maierhofer made that I found particularly interesting was his point that during both time periods, the economic devastation was preceded by extreme optimism, that no one (or very few experts anyway) seemed to see the imminent collapse on the horizon.  It was also interesting to me that both economic disasters seemed to be preempted by the collapse of a real estate bubble.  I, for one, had never numbered a housing boom as one of the causes of the Great Depression.  Maierhofer also points out that one of the most striking similarities between the market then and now is that trouble seems to be across the entire economy and not simply located in a few kinds of sectors.

If Treasury Secretary Timothy Geithner doesn’t know how to get appropriately compensated for the loans / bailouts that he keeps approving on behalf of the United States Government then he shouldn’t be giving out these loans at all.  His mismanagement of these negotiations is wasting our money.

For instance last year, when Geithner, then operating through the New York Fed, decided to bailout AIG, the ailing insurance giant was already in negotiations with banks that would have retired their Credit Default Swaps with AIG paying 40 cents on the dollar.  Once Geithner took over the negotiations, he instructed AIG to pay 100 cents on the dollar.  The flubbed negotiations cost American taxpayers at least $19 billion (i.e. 60% of the $32.5 billion that AIG paid to retire the swaps).

National Geographic magazine is a national treasure and as such, those of us in the US should support it. At $15/year, you’ll receive the best journalistic and nature photography ever, and you’ll learn something, too.

Visit this link and subscribe all your nieces and nephews. They’ll receive 12 issues for $15. Even if they don’t read, they’ll enjoy the beautiful pictures. Also, you can repurpose them into dioramas, collages, and other art projects. National Geographic employs the best photographers worldwide and has also awarded more than 8,000 grants for exploration, research, and conservation efforts.

Last week, we posted a blog entry that called out Bank of America for its plans to begin testing the introduction of annual fees on active credit card accounts. Relative to the October 6th media frenzy that occurred after BofA wrote letters to both Sen. Chris Dodd (D-CT) and Rep. Barney Frank (D-MA), pledging that it would stop re-pricing its existing credit card customer base, these new annual fees are unethical and contradictory to the promise the bank made to both lawmakers and to its customers. Additionally, it is our belief that if Bank of America moves forward with its plans to raise membership fees on existing customers into 2010, it will be breaking the laws mandated under the CARD Act, which is slated to take effect in February of next year.

We knew our blog post might spark some controversy, and that it would likely circulate quite a bit. Nonetheless, we were still surprised when we were contacted by Bank of America’s corporate communications department. The spokesperson who contacted us insisted by phone that Bank of America’s letter to Sen. Dodd and Rep. Frank referred to interest rates and interest rates only, and that it made no mention of annual fees. We found the letter. Here’s what it said:

It seems that Bank of America has already reneged on the October 6th promise it made to stop raising the interest rates on the credit cards of its existing customer base.  Just a week after making this pledge, BofA announced that it would begin introducing annual membership fees, ranging from $29 to $99, to select customers next year.  Combined, these two announcements result in a net win of zero for consumers, and in an unethical bait and switch play on the part of Bank of America.  Why?  Because, according to regulation, interest rates and annual membership fees fall under the same umbrella.  They are both considered finance charges.

While BofA postured as if was taking a step towards consumer protection in making the announcement that it would stop raising rates, the introduction of new annual fees to existing credit card accounts will still result in increased finance charges for account holders, even if those finance charges are referred to and assessed by another name.  For insight, consider that the addition of an annual fee of $50, on a credit card account with $500 balance and a ten percent interest rate, would double the overall yearly finance charges associated with that card.