Here’s a dose of good news for consumers and bad news for issuers: Credit spending is declining as “cautious consumers” pick debt over credit, going with the mantra to pay now instead of later, reports NewsWeek. Credit card use in 2009 fell to an all-time low of 56%, as compared to 97% back in 2007, and is projected to continue dipping to 45% at the end of 2010.

Consumers are wising up and becoming reluctant to spend money they don’t have, as opposed to the pre-recession highs of excessive credit use and overspending. Consumers are switching to alternative payment methods like debit, cash, prepaid cards, gift cards, and more. Its a serious revenue fall for issuers, but a positive step for consumers fixing to be credit card debt-free.

Today’s roundup is loaded with useful and interesting information and advice on credit cards and debt, fresh-picked from blogs and news around the web.

Credit Card News

• Bankrate lists the 5 cities with the most credit cards and the 5 cities with the least credit cards. Did your city make either list?
• Bankrate also discusses Should You Carry Multiple Cards?
• Free From Broke makes it plain and simple in this cool infographic that Buying Stuff On Credit Is Expensive.
• Build A Professional Relationship With Your Banker, suggests MoneyNing. They don’t have to be your enemy; having a good relationship with your bank can benefit you and your account.
• Have an awesome rewards credit card? If you’ve earned rewards and are ready to redeem, first read WiseBread’s Pitting Airline Against Hotel Rewards to help make the most of your card.
• Read what one East Coast college is doing to help young consumers in CNN Money’s, N.Y. Colleges To Protect Students On Credit Cards.

Debt News

• 20 Basic Steps To Keeping Bad Debt At Bay, from Financial Highway, reminds you to keep your finances in check.
• Len Penzo blogs 10 Key Characteristics of Debt-Free People; anything fit your description?
• The ‘Obama debt relief’ scam, from MSN Money, warns you of shady debt settlement companies to avoid and how to settle the right way.
• Check out these fascinating stories from The New York Times about brave couples dealing with money issues in, How Debt Can Destroy A Budding Relationship.
• Need some help organizing debts? Squawkfox can help with the Dig Yourself Out With The Debt Reduction Spreadsheet.
• 10 Ways To Get Out Of Debt Starting Now, from Saving To Inve$t, shares smart tips like 2.) You don’t NEED a credit card.

New regulations from the Federal Trade Commission will curb abuses from debt collection agencies pursuing old debts that won’t die, reports The New York Times.

In most states, it is legal for collectors to pursue out-of-statute debt– old debt for which the statue of limitations expired–as long as they do not file a lawsuit or threaten to do so. But oftentimes, lawsuits are filed anyway, debt collectors harass consumers, and consumers forced to pay a small amount on their out-of-statute debt, unknowingly reviving and restarting the clock on the debt.

But, the FTC called for significant reforms of the debt collection industry and recommended that states better protect consumers by clarifying the murky laws that govern out-of-statute debt.

Consumer Reports blogs that the FTC already issued new rules, taking effect this October, to reform debt relief services that often “do more harm than good”.

Protect yourself from debt trouble and credit card issues with the following roundup of our favorite personal finance articles and blogs this week!

Credit Card News

• Credit cards are way too easy to get, blogs Realm of Prosperity. Check out 3 Lessons My Parents Never Taught Me About Credit Cards.
• When Are You Old Enough For Your First Credit Card?, asks Mint blog.
• Watch out! Issuers have New Credit-Card Tricks up their sleeves, writes Wall Street Journal.
• Where Not To Use Your Debit Card, reports the New York Times.
• Putting your name on a credit card contract with someone else? Financial Highway helps you know the difference between Joint Credit Card vs Authorized User.

Debt News

• Bargaineering settles a good question — Does Settling Credit Card Debt Hurt Your Credit Score?
• Facing Debt Trouble? How I Deal With Debt Stress, from The Digerati Life. Tame your debt demons!
• Free Money Finance lists 11 Smart Ways To Help Get Out Of Debt, such as Have your paycheck direct-deposited.
• Financial Web explains, Understanding Zombie Debt, about the very old debt on your record that could come back to haunt you.
• Are student loans “good debt”? Forbes discusses The Dangers Of Paying For Your Kid’s College.

Did credit card reform really do any good? More than a year since the passing of the CARD Act in May 2009, news media and blogs weigh the good and the bad.

MSN Money points out that while the CARD Act was intended to prevent many of the costly, damaging credit card practices that affected consumers last year, these rates and fees continue in 2010– just to a lesser degree. The Digerati Life blog writes, “I hate to say it, but it looks like Congress did a fairly good job of curbing historical abuses and preventing future unfair practices without resorting to draconian price controls.” Bucks blog at the New York Times stays middle-of-the-road, pointing out that while reform has stopped many of the industry’s “deceptive” or “unfair” practices, issuers are still engaging in others.

Maybe it’s not so much a matter of whether the credit card reform did any good, but whether it did enough good?

What do you think? Has the CARD Act reforms met your expectations of better, safer, and fairer credit cards for consumers?

Today’s roundup offers interesting and helpful information for credit cardholders and consumers digging their way out of debt. Read our favorite posts on these topics from news and blogs and enjoy!

Credit Card News

• Read this just in case it should ever happen to you: How to recover from a stolen credit card, from Bargaineering.
• Don’t say you weren’t warned: Five lies your bank will tell you, from DebtKid.
• Your bank still being shady? Look out for more from Ask Liz Weston’s 5 ways your bank can still gouge you.
• Fight Over Debit Card Fees Far From Over, reports Kiplinger.
• Here’s an interesting perspective on credit card rewards from The New York Time’s Bucks Blog– How Much Credit Card Rewards Cost the Poor.

Debt News

• Jesus Saves? The Bible Budget, from MainStreet, attempts to explain the phenomenon of why Bible readers have less debt that people who don’t read the Bible.
• Dough Roller suggests ways to ditch debt by getting 10 Jobs To Earn Some Extra Cash.
• Will it hurt or help your credit? Financial Highway discusses How Debt Consolidation Affects Your Credit Report.
• Broke? You aren’t the only one. Miss Bankrupt shares How Broke People Can Eat Healthy.
• Consumer Debt Paid Off… Now What? asks Canadian Finance Blog.

Going Cashless

Once upon a time, cash was ubiquitous amongst common folk and “charging it” was reserved for the rich, fancy-pants type. Now, most Americans are paying less by paper and coin and more often in credit card, debit card, online transaction, and even up-and-coming mobile phone payments.

MintLife Blog writes that the future of money is the age of the cashless, as the rise of debit cards in the mid-1900s signaled the decline of paper checks and cash. Today, the fall of cash is speeding up thanks to increased credit card use and the introduction of mobile transactions via Smartphone, reports Daily Finance. Down the road, paying by cell phone may force credit cards to go the way of cash.

It’s unlikely that you’ll make a definitive lifestyle change to go all plastic, but it’s interesting to see the perks and precautions if you did decide to go all-cash instead. If you decide to go with either extreme and ditch cash or plastic, be sure to comment and let us know how it’s going.

Going All-Cash

• Perk: Imagine life without debt. If you go all cash, you can’t get in over your head with debt if you aren’t swiping more on credit than you have actual money in the bank. Plus, budgeting strategies like the cash envelope system is a simple way to keep track of expenses and restrict spending.
• Precaution: If you don’t use credit, you won’t build credit. A great credit score and comprehensive credit report is crucial for a healthy financial life because it gives access to loans, credit, and is looked at by employers, landlords, etc. Without credit, you’re limited in your financial options.
• Perk: You avoid pesky fees and sneaky banking practices. You won’t be subject to the ups and downs of the credit card industry and won’t have to worry about interest rate hikes or surprise charges if you steer clear of using plastic altogether.
• Precaution: You’ll give up some convenience. Carrying hundreds of dollars on you for every shopping trip or big ticket purchase is not only inconvenient, but can also put you at greater risk of theft. Plus, you’ll have to make constant trips back and forth to the bank.
• Perk: How would you like less stress? Cash-only means you will potentially have no debt fears looming over you, no credit card bills to be anxious about, and you’ll learn to manage money so that you are in control of it, rather than the other way around.
• Precaution: With no credit or debit card, you can’t benefit from any cash back or rewards program. If you look forward to getting cash rebates, airline miles, or rewards points for every time you spend, it may not be worth it to you to go without plastic cold turkey.

Today, new legislation regarding debit cards kicks in and customers now have to opt-in and agree to overdraft policies rather than be automatically enrolled in the bank’s program. This is a good reminder to check your own bank’s overdraft policies and, if you want to be covered by overdraft, to enroll in it now.

We put together a short list of other financial areas in need of a check-up, just to keep up with the changing landscape of money and banking. If you find yourself spending more time thinking through any of these points, it’s a good indication you need to delve a little deeper and focus on that aspect of your finances. Now, get ready to start checking off:

1. Check your plastic. Rewards credit cards are still on the chopping block, sneaky fees (such as annual fees and interest rate hikes) are eluding CARD Act regulations, and debit cards are at risk of losing free checking.
   
   Check on the terms of your credit cards, such as the state of your rewards points or any new tacked-on fees. If your current plastic isn’t shaping up, seek alternatives that are lower interest, less fees, and better fit for your spending style.
2. Check your living situation. It’s an extraordinary time to buy a home, with mortgage rates at their lowest in decades. While rates are doing little to motivate buyers, the fact remains that buying a home is incredibly affordable right now.
   
   If you can afford the down payment and have good credit, this is an opportune time to buy. If you already have a mortgage, consider refinancing. Reset your mortgage to better rates, lower monthly payments, and possibly shorter loan term. Check out Bankrate for mortgage rates.
3. Check your piggybank. Are you earning the most you can earn on your savings?
   
   Check your APY and see if you can earn higher interest at a different bank or even a different financial product, such as a CD or a money market account. Online banks also tend to offer better interest pay-offs because, without physical branches or ATMs, they can afford to.
4. Check your loans. Recent alums should be on the lookout for student loan repayment to kick in within a few months right now.
   Best thing to do now is plan out how much additionally you can add to your minimum monthly payment. If you begin putting money aside now to put more towards your loan payments, you’ll be debt free sooner and save money on interest.
5. Check your debt. Still turning a blind-eye to your escalating debt?
   
   Bite the bullet and add up your total credit card debt. You could take the time to calculate how much interest its costing you or how long it will take to pay off; but the bigger picture is that you need to deal with your debt asap because it is costing you time and money.

Do you have any other important steps to suggest? Comment below and share with us what we should check on too!

While credit card perks are getting slashed and debit cards and checking accounts face looming fees, the start-up Perk Street Financial will soon be offering the irresistible upgrade to double their debit card’s cash back program to 2% cash back on every dollar of debit card purchases the cardholder signs for. If you’re looking for a great rewards debit card, you might have found it.

PerkStreet Financial’s debit card is something we’ve liked before, offering interesting rewards programs of coffee, music, or cash, and a banking philosophy hinged on serving consumers an honest, quality product. “We believe that banks should align their goals with their customers’ best interests – to give them what they want and need,” reads the site’s vision statement. Who could disagree with that? Now, the extra cash back is an extra incentive to check out their product again.

With the PerkStreet Financial debit card, any customer with a balance of at least $5,000 at the start of each day can earn 2% cash back; those with balances below $5,000 can earn the usual 1% cash back. There is no limit on cash back earned at the 2% rate, and PerkStreet remains a free checking account, and no sign of them changing with the times (i.e the era of ending free checking).

The New York Times makes a great example to put in perspective just how generous this offer is: “Those who spend $2,000 a month on a Perk Street debit card and have at least a $5,000 balance will earn $480 in annual awards. And that’s before any earnings from the 5 percent bonuses in various merchant categories that the company plans to start offering this week.” And remember, this offer comes at a time when you’re hard pressed to find a debit card that earns at least 1%; and the ones that do, like the Chase Real Cash Debit Card, only offers cash back for specific categories.

However, PerkStreet still faces some challenges in getting consumers to switch banks. Aside from not having their own branches or ATMs, it’s also typically a pain for consumers to move any automated payments or tied accounts from one checking account to another. But if you do have at least $5,000 in the bank and wouldn’t mind earning an awesome 2% cash back, PerkStreet’s debit card sounds almost too good to be true — its the richest debit card offer out there right now.

First there was Blippy, now there is Swipely. What otherwise sounds like names for cute, furry creatures are actually sophisticated social shopping websites that allows users to share their online shopping habits with their online community. Joining the social ranks of Twitter and Facebook, Blippy and Swipely aren’t just about sharing every little mundane purchase. Both websites are premised on the engagement and value of what you bought, where you bought it, and what you thought about it…and the bigger idea that other people will be interested too.

Blippy and Swipely connect your wallet to the internet by linking your credit and debit cards to your online profile; once you join, your online purchases will stream to a news feed on users’ homepage along with other people’s purchase updates. Your latest purchase will show up on Blippy or Swipely for other people to comment on. It functions like Twitter’s constant stream of users’ personal status update, but instead of a 140 character limit, your credit card speaks for itself.

Both websites emphasize the power of sharing consumer information: what one recommends or doesn’t recommend, questions about purchases, and conversations around shopping—all at a fast pace and in real-time. Consumers themselves can generate real, organic conversations about services and products (and also be the ultimate data mining source for companies, a dream come true in cost-free marketing, or a nightmare in negative customer feedback).

While we’ve reviewed Blippy before, Swipely is the new kid on the scene. Swipely upgrades the purchase-sharing option beyond Blippy’s standard “how much was spent where” format (for example, ‘CreditKarma spent $250 at Amazon’) to include online access to over 250,000 retailers and restaurants so users can get specific about what they bought. Also, Swipely does not automatically include how much you spent; the idea is to focus on the story behind the purchase, such as what you bought and where. Finally, users can also rate purchases on a scale, which could lead to a database of user experiences and ratings the likes of Yelp.

But, will all of this catch on? Will people be as eager to share their online shopping habits on Blippy and Swipely as much as they share their everyday activities on Twitter? Can credit card transactions really be social and lead to conversations? Blippy and Swipely are trying to change the culture of how we think about our spending; that personal finance is something to we can share and, in a way, helps us monitor our own consumer habits as well as eavesdrop on others.

Wall Street can’t seem to figure it out.

Investigations into the last Thursday’s historic yet mysterious stock market plunge, which dropped the Dow Jones industrial average nearly 1,000 points in one day, hasn’t come up with much of an explanation into what happened. Some speculate it was a large, erroneous trade– the so-called “fat finger” scenario, or that the Greek debt crisis caused ripple effect panic in the American market, or a technical computer glitch started the chain of events that led to the biggest single-day drop in Wall Street history.

It is likely a combination of unusual factors, but its ultimate cause remains a mystery. A federal subcommittee continues to investigate and explore ways to safeguard Wall Street against any such future malfunction or mistaken trade that could trigger another devastating plunge.

Staying educated and aware of your own personal finances is your best safeguard against any financial disaster. Why not start right here with today’s roundup on credit cards news and debt help?

Credit Card News

• Not sure which plastic to swipe? Moolanomy Personal Finance explains when to use a credit card instead of a debit card.
• How to get approved for a prime credit card, brought to you by The Digerati Life.
• Are your shopping habits out of control? WiseBread suggests reducing your credit limits to manage your spending.
• The Dough Roller counts down the five most annoying credit card fees, starting with those pesky interchange fees.
• Is swiping a card less rewarding?, asks SmartMoney, about the decreasing value of credit card rewards programs.

Debt News

• When facing bankruptcy and foreclosure, do you know what your debt plan would be? Check out Debt Free Adventure’s post.
• Do you know the ins and outs of debt? Take Enemy of Debt’s quiz, Are You A Financial Rock Star Or In Serious Danger?
• Managing bad debt versus good debt–do you know the difference? Head to LearnVest to learn more.
• The food you eat has profound effects on the financial and literal health of your life, writes Man Vs. Debt. Read more about how your eating habits affects your finances in Are You Eating Yourself Into Debt?
• To consolidate or not to consolidate? Figure out this question with Bankrate.com’s handy Personal Debt Consolidation tool to calculate the effect of consolidating your debt.

Now that you’ve budgeted and built your piggybank for your trip to Disneyland or trek through Delhi in Part 1: Stay Out of Debt, preparing for vacation takes more than just packing sunblock. Protecting your wallet and credit is a crucial step that many travelers make an afterthought. Don’t fall victim to credit card bill shock or an empty bank account when you get home. Take every step to secure your finances while you are on vacation.

A big question for jet-setting travelers: cash or plastic? There are benefits and risks with both, so here’s a breakdown of how to take the right steps with both.

Carrying cash?

Always bring an amount of cash on vacation for emergencies. How much you bring depends on what you’re comfortable with. If you want to pay cash for everything to avoid a hefty post-vacation credit card bill, take precautions against theft: split up money in different suitcases when in transit and pockets when you’re out and about, keep all cash in your hotel safe (or as secure a place as possible) and only bring cash you need for the day, and be alert and aware in public and in large crowds at all times.

A debit card is often inadvisable to bring because it’s harder than a credit card to resolve unauthorized charges should your debit card get lost or stolen, and it’s harder to dispute an erroneous charge on your statement. Traveler’s checks, once an overseas staple, are typically more of a hassle to get and use than just bringing a credit card or extra cash. Traveler’s checks are also not as commonly accepted everywhere as a form of payment. Check out other cash-carrying tips on Bankrate’s Best ways to get cash overseas.

If you decide to bring debit or ATM card, call your bank and see if you can use your ATM card where you are travelling. Ask if you will be charged a foreign exchange fee, typically 1% to 3%, for ATM withdrawals, your daily withdrawal limit, and maximum number of withdrawals in a month. Wherever you go, make sure you have at least a small emergency stash of cash just in case.

If you plan to mix credit and cash….

Know how your credit card works.

In most instances, a credit card’s convenience, flexible spending, and spending protections make it the best bet for traveling. Also, it safer to bring around than packing cash and you can immediately cancel your credit card if lost or stolen. More need-to-know info:

1. Figure out which of your credit cards are good for traveling aboard. Watch out for extra fees and rates such as cash advance fees, foreign transaction fees, foreign currency conversion fees, and how widely accepted your card is. For example, Discover charges no fees for overseas transaction, but isn’t as widely accepted as MasterCard, Visa, and American Express. For a quick view, check out Bankrate.com’s nifty chart of currency conversion fees. Some cards also have great travel protection and perks like complimentary concierge service, fraud liability, travel and emergency assistance, etc. If you plan to place most purchases on credit, then tote a rewards card to cash in on big ticket spending. If none of your cards are good bets for travel, open up a new credit card like the ones recommended on SmartMoney’s The Best Credit Cards for Travel.
2. Notify your credit card companies that you will be on vacation and may be charging frequently on your card. This avoids any suspicion or alert that your card has been stolen, plus issuers may offer a higher credit limit, lower APR, or other perks if they know you’re about to do some heavy spending. While you’re on the line with your issuer, also clarify about possible fees they’ll be charging as you travel.
3. Bring your issuer’s phone number with you to call should your card be lost or stolen.
4. Check your credit card limit. Whatever you do, do not exceed this limit while you are travelling! Bring more than one credit card with you, but leave the rest at home. In any case, you should budget well enough—and stick to it—to never worry about maxing out your credit card.
5. Keep receipts of credit card purchases to check your credit card bill when you get home to make sure all purchases on bill match receipts, exchange rate correctly calculated, and no additional charges or purchases were made on your card.

Follow these money tips to smooth out any financial wrinkles and protect your money. Always keep in mind how all of these transactions will affect your financial situation—your level of savings, level of debt, and credit score. While you budgeted like crazy planning for vacation, don’t throw it all away by withdrawing heavily or charging on credit while you are traveling. Exceeding your credit card limit and going into debt will damage your credit score far longer than your vacation lasts.

Get ready for the final part of our travel series with extra money travel tips on How To Stay Financially Fit. Coming soon!

Have you noticed significant changes to your bank’s overdraft policy recently? This July, new regulations are ending the common banking practice of automatically enrolling customers in getoverdraft policies that have long been under fire for steep fees and lack of transparency. Soon, customers will have to intentionally enroll in overdraft policies in order for the bank to cover them in the case of insufficient funds on their checking account.

It’s a step in the right direction to put the power of banking in the consumer’s hands. Know and understand your bank’s policies; some customers want overdraft protection so their card won’t get declined, especially in the case of an emergency purchase. Other customers don’t want to be charged a $35 overdraft fee for overdrawing on a $3 cup of coffee.

Some big banks have already put their new overdraft policies to work. Here is what some of the big banks are planning to implement:

1. Bank Of America, is effectively ending overdraft protection and will reject debit card purchases if there are insufficient funds. For ATM transactions, customers overdrawing on their account will be asked if they agree to pay a $35 fee to be covered. Since customers can’t be notified about being overdrawn on their debit card during point-of-sale at a cash register, they will deny any such transactions. This new policy kicks in on June 19 for new accounts, early August for existing accounts.
2. Chase is already playing by the new rules ahead of the summer deadline and has sent out notices to existing customers urging approval to opt into overdraft coverage. Customers must sign up for overdraft protection on-line, over the phone, or in a bank branch if they prefer their funds be covered—with a $30 fee—in case of over-drafting. Otherwise, transactions will be declined.
3. Citi has a long-standing policy that has never allowed ATM and debit point-of-sale transactions if there the customer has insufficient funds. Protection services offered are Safety Check, overdraft protection for bounced checks, and Checking Plus, a revolving line of credit that will also cover bounced checks.
4. If you do not opt-in to Capital One’s Overdraft Protection service—with $35 fee for covering overdrafts— by August 15 for existing accounts (opened prior July 1) and July 1 for new accounts, Capital One will decline debit card or ATM transactions that overdraw.
5. New and existing Wells Fargo customers must currently sign up for Overdraft Protection on-line, to cover overdrawn ATM transactions and returned checks. Wells Fargo also revamped their overdraft fees for linked credit cards into a tiered fee structure ranging $10 to $20, dependent on the total amount of the advance for all overdrafts occurring in a single day.

If you want the added security and peace of mind that your debit transactions, ATM withdrawals, and checks won’t be rejected, then your bank’s overdraft protection can provide you that for a fee. Otherwise, avoid the risk of insufficient funds by keeping track of your account money and setting a baseline amount, say $500, which your money will never fall below. That way, you never have to worry about insufficient funds or deal with the headache of overdraft fees.