The 53-year-old woman in Fredericksburg, Va. was trying to perform a good deed. She found an iPhone near a convenience store, and contacted the owner to give it back. They agreed to meet up outside of a restaurant, and the phone’s owner promised a reward. Then things went horribly wrong: according to police, the phone’s owner took the phone back, handed over the reward, then attacked her from behind while she was walking away.
If you received a bunch of miles from Citi for signing up for one of the bank’s credit cards or rewards-earning accounts, be on the lookout for a 1099-Misc tax form coming in the mail, as Citi has decided that these miles have a taxable value.
After a nearly apocalyptic pull-back in the credit card market, with credit lines slashed to the quick and new credit being denied, banks have decided to let a trickle flow out again. To entice the cream of the credit score crop, they’re dangling a new batch of incentives. Via the Richmond Times-Dispatch, here’s some of the best deals out there right now on credit cards:
Like deciding whether to tap your Fountain of Youth or send in your Force of Nature in Magic: The Gathering, deciding which credit to play in the travel game depends on your situation and strategy.
Yuriy traded in 70,000 Citi credit card reward points for $700 in gift cards. He intended to use the cards to buy a new laptop for his mother–how sweet! But something has gone horribly wrong, and the package of gift cards is stranded in Secaucus, N.J. It will take seven weeks for Citi to believe that the cards are really missing and issue replacements.
A new study from the Federal Reserve Bank of Boston says that credit card reward programs have a sneaky hidden cost that the card holder doesn’t have to bear. This occurs because the fee that a retailer pays to run a credit card varies with every card, and reward cards cost more to process–in other words, the card issuer passes the cost of the rewards program on to the retailer. The retailer adapts by raising prices across the board, which distributes the cost of the reward program among all shoppers.
Over on his travel blog, Christopher Elliott writes that if you want to ensure you’ll get the reward program miles you deserve, you should hold on to your boarding pass. In his example, a frequent flyer with Air France couldn’t get his Delta miles credited even though the airlines codeshare, because Air France demanded the original Delta boarding pass, which the customer had thrown away. Elliot managed to get the airline to cave on this instance, but he points out that it’s easier (and better in case of an IRS audit) to hold on to them “just in case.”
The PayPal plus rewards card earns points which can be traded for vouchers which can be used like cash to buy stuff. You have to be careful, though, and make sure that the price is the same or greater than the voucher amount. Any unused dollars on the voucher get forfeited after the purchase. Tricky! Reads those terms and conditions close, folks.
Daniel says Chase promised him to retroactively give him rewards on past purchases after he switched account types, but somehow he ended up with a negative rewards balance. He says he’s got more than $600 in rewards coming to him, but Chase won’t budge and give Dave what he believes he’s entitled to. He writes:
Merchants are pushing for more credit card fee reform, for the fees they have to pay. Every time you swipe at checkout, whether it’s a credit or debit card, the merchant has to pay two fees. One is a flat per transaction fee, the other is a percentage of the total sale, called the interchange fee. Those rewards cards you’re so fond of? They have the higest interchange fees. Those rewards and cashbacks don’t come from a magical reward tree, they’re paid for by the interchange fees. In other words, the Quickie Mart is paying for your “free” airline miles.
Reader IfThenElvis forwarded us the following email he received alerting him to changes in the Reward Zone program from Best Buy. He adds, “I can’t tell if this is good new or not. I suspect not.” It’s not the end of the world or anything, but it definitely marks a slight constriction in the program.
Citibank Comes Up With Elaborate Cash Back Offer That Reduces Credit Limit And Temporarily Suspends Card
Compared to what some other banks and card companies are doing to reduce their exposure to debt, we guess Citibank’s cash back offer isn’t that bad—it’s sort of a “let us help you help yourself get rid of your debt” scheme. It’s funny, however, if only because it’s such an elaborate way to get customers to self-select for a reduction in credit.
“Revolvers”—customers who keep a revolving balance on their credit cards—used to be the cash crop for credit card companies. But now more and more of them are turning into expensive charge-offs, and the new CARD act is going to make it harder to acquire those riskier customers anyway. As a result, card companies are beginning to look more closely at the customer who was most hated back in the credit-orgy years: the deadbeat.
Tired of using a two credit card system to maximize his cash back returns, I did an analysis to determine the single best cash back credit card. Here’s what I found:
What’s going to happen with Citibank’s ThankYou Network on March 1st? Is Vikram Pandit going to convert all of your points into executive bonuses? Will it be nationalized?!? Um, no, but here’s a copy of the letter one of our readers received today announcing the changes that are going in place next week.
If you have a large number of points you better use them in the next few weeks, or be content with getting a large amount of Coke-branded clothing.