The Incredibly Shrinking Credit Card Rewards Sign Up Bonus
Written by Jai Borchgrevink on May 14, 2012.
If an observer follows a market for long enough, eventually a pattern emerges. Competitors repeatedly try to outbid each other in their efforts to acquire a scarce commodity. Ultimately, the increased offers cannot be sustained and the market collapses. This can take the form of a minor correction or it can resemble a bubble bursting. Unfortunately for some credit card applicants, the market for sign up bonuses appears to be going through just such a phase.
For example, one of the hot cards of 2011 – Chase Sapphire Preferred – has just seen its fantastic sign up bonus reduced from 50,000 Ultimate Rewards points to 40,000. In the past, this sign up bonus was worth $500 in gift cards, statement credits, or other rewards. Others redeemed these points for 50,000 frequent flier miles or hotel points, or $625 worth of airfare. Now
Advances in technology such as chip and pin – and more recently near field communication contactless payment solutions – mean that embossed credit card numbers could become a thing of the past.However, companies want to hold onto raised numbers because it means that transactions can still be carried out when retailers cannot access the internet and complete sales digitally.Commenting on the fact that raised numbers on credit cards are not likely to go away any time soon, David Masters, MasterCards vice president of strategy and corporate affairs, told the Register: “The genius of our system is global interoperability.”Raised numbers are used so that merchants can make a copy of the cards details quickly and easily. They provide retailers with a backup when digital connections fail for whatever reason.Contactless payment, however, is one of the reasons that prepaid travel cards have already abandoned raised numbering – because they are designed to limit a persons spending to the balance in their account. 
The failure of wage increases to keep pace with the rates of inflation is often cited as one of the main reasons families struggle with their living expenses. However, a study conducted by XpertHR has found many private sector employees could be set to receive increases of two per cent on average later this year. It was noted that this is still behind the current rates of inflation, so anyone expecting to have a hard time keeping on top of bill payments is advised to draw up a budget plan. Ensuring all bill deadlines are met is an essential consideration, as failing to do so can lead to the development of a bad credit rating. People already facing this issue can take out a credit card to ease the strain and use it to make day-to-day purchases. While this may seem counterintuitive, regular spending on plastic is the easiest way to prove to a lender the individual is able to take control and turn their money situation around. 
Using a credit card as an aid to budgeting is one of the most effective means of taking advantage of the financial products. It is essential that people do not access more credit than they can reasonably afford, as this could lead to difficulties with repayments. This is best avoided, as missing a bill deadline can lead to the development of a bad credit rating. If the individual is concerned they may struggle to meet a payment, they are advised to contact the relevant provider as soon as possible in order to make alternative arrangements.However, individuals who have already failed to do so can rest assured the situation can be resolved. Taking out a bad credit credit card can help to repair the persons financial standing slowly but surely, as it can be used to prove to lenders that they can be disciplined and take control of a difficult situation. Posted by Gemma Walker
While the rising cost of living continues to stretch household budgets to their limits, many people could be worried about balancing their finances. This is a highly important consideration, as taking steps to ensure outgoings do not exceed income can improve an individuals credit rating. New statistics from the British Bankers Association (BBA) indicate the nations consumers are successfully able to do this by focusing on their debt repayments. In January 2012, spending on credit cards hit £7.1 billion across the country, which is above the six-month average. However, it was noted this is more than offset by repayments, which would appear to suggest Brits are successfully able to maintain control of their finances and pay down debt at the same time as taking on credit. An estimated £118.3 million of purchases were made on plastic in December 2011, which dipped slightly to £115.9 million in the first month of 2012. I