What's new: Banks are not going to sit back and watch billions of dollars of fee revenue vaporize. The reality is that they are working overtime right now dreaming up ways to keep raking in the money.
Pay attention: Interest rates are going up (yes, you will get a 45-day heads up). According to a recent Wall Street Journal report, the average interest rate (APR) had already risen from about 12 percent six months ago to 14.2 percent today. For individuals with weak credit, the average APR is now 24.9 percent compared to 14.3 percent six months ago. Expect more of that going forward as the banks take advantage of any opportunity to make money. Look, you know my advice here: Pay off your balances and only charge what you can afford to pay off each month. But that's a goal that may take time. I get it. Again, I encourage you to look into a balance transfer to a credit union card. Go to CreditCardConnection.org to search for credit union offers.
We are also already seeing a huge and troubling resurgence in credit card annual fees of $50, $60 or more. What to do if you are hit with an annual fee.
I also want to mention that a few costly practices were not changed. Credit card issuers can still charge hefty balance transfer fees. A year or so ago, it was common to be hit with a maximum fee of $75 or so. Today, many card issuers charge a flat percentage of the amount transferred, and it can be 3 percent or more. That adds up fast. Another practice that was not changed or rolled back was the fact that many card issuers changed how they calculated your minimum payment due. It used to be as low as 1 percent and now is often 3 percent to 5 percent. While that's actually very good for consumers because it means the balance will be paid off faster, the timing of this shift—during the most crippling recession and the highest unemployment rate in more than 25 years—was (and is) deplorable.
The bottom line is that the new credit card protections are a big help. But they require you to still be an active and vigilant consumer. Stay sharp, read your statements and do your very best to charge only what you know you can afford to pay off at the end of the month. Do that, and you don't have to care what interest rate is charged on unpaid balances.
Spring-cleaning with Suze: Overhaul your files and finances