Think about it logically: how can credit card companies research each and every household they plan to send an application to?(1)  The time they could spend on doing just that they’d rather spend on making mailing lists and sending as many applications as they can.  It is just like a more personal take on advertising.  The credit card companies just want you to be aware of the services that they are offering.  So when you get a handful of credit card applications from various banks, it does not mean that you can afford any of the deals they are offering.  Maybe you are even better off without a credit card at all.

Myth #2: Pay the minimum balance and you will be fine

If you are so confident about your credit card debt because you tend to zero in on how much the minimum payment is, you will end up in deep financial trouble.  Think about the balance that you left last month and then add up the balance you will leave this month because you are paying only the minimum.  Calculate the interest that will result in all those left-over balances and you know that you have gotten yourself deep under a pile of debt.  Not only that, think about the state your credit score will be in after all this: terrible, just terrible.(2)

Myth #3: Using a debt consolidation company is easy

You probably think that since you are deep in debt, there is no other way for you to pay everything off but by hiring the services of a debt consolidation company.  It won’t be easy, however.  There are many things that you should consider about a consolidation company.  Can you afford its service?  Remember that you are already deep in debt.  Is it a reliable company?  There are debt consolidation companies that operate under the radar; they cannot be trusted with your money.   Is it superior to your ability to pay off all your debts yourself?  Maybe, it is. However, if you have enough discipline to pay the company a certain amount, you can have enough discipline to consolidate your own debts.(3)

Myth #4: You only have one credit score

Having one credit score may be neat, especially for those with nice scores.  It may be a disaster if your score is a mess.  You actually have three credit scores from three main credit agencies.  Pray that your best-looking record will be referred to when your credit history gets checked out.(4)

Myth #5: You only need to cancel a credit card to improve your credit score

When you close a credit card account, you only give yourself a little bit more control over your finances.  You have fewer or no credit cards left after the cancellation.  However, closing the account will not improve your credit card score at all.  You also shorten your credit age, which is an important factor in your credit score.(4)

Myth #6: Your negative record remains in your credit score for seven years

Bad credit record does not have to stick around for seven years or for any other period of time.(5)  In fact, you can actually negotiate to have a record removed.(4)  One way to negotiate with creditors is, of course, by paying the debt.  You will just ask for the creditors to eliminate the record that states that you have been awfully late with your payments.  You do not even have to be completely paid to negotiate with your creditors; you can actually promise to pay them within a certain period of time.(6)

Myth #7: All three major credit bureaus will have identical reports

Refer to the debunking of the myth that says you have only one credit score.  The three companies do not have the same records. The reason for this?  Not all of your creditors get to report to every company.(7)  So, the more creditors you have, then the more likely your three reports are completely different from each other.

Myth #8: Credit cards are your little helpers

Credit cards may seem like free cash, especially at first.  However, they are also very expensive to maintain.(8)  Instead of paying for the retail price of a product, you end up paying not only the retail price but also the interest.  If you have not been able to pay all your balances every month, you will end up paying so much more.  To put things to the extreme end, credit cards cannot really offer a lot of positive things, except letting you buy things that you should not buy anyway.(9)  Most people have become so dependent on credit cards that one of the popular myths has arisen:  credit card makes you afford things and without it you cannot afford anything.  The truth is that you should not use your credit card to buy extremely expensive items in the first place: it would take a long time and heavy interest fees for them to get paid.

There are still a lot of credit-related myths out there.  Educate yourself about credit cards in general.  This way, you can debunk the remaining myths and keep away from credit mistakes that can drive you towards bankruptcy.  If you can manage your finances with cash, try to stick with it.  Remember the time when you applied for a credit card for emergency purposes?  Try to steer yourself back in time.

SOURCES:
(1)    http://myvesta.org.uk/pubs/20-greatest-myths-about-credit-debt
(2)    http://www.directlendingsolutions.com/myths_about_credit_debt.htm
(3)    http://www.creditcards.com/credit-card-news/8-myths-about-settling-credit-card-debt-1265.php
(4)    http://bettercreditblog.org/2008/09/10/6-most-common-credit-myths/
(5)    http://ratebox.com/tl/10-great-credit-myths-exposed/
(6)    http://bettercreditblog.org/2007/11/16/negotiating-with-creditors-to-get-negative-records-removed/
(7)    http://www.zeromillion.com/financial-services/common-credit-score-myths-by-gary-gresham.html
(8)    http://www.debteliminator101.com/credit-myths.php
(9)    http://www.daveramsey.com/the_truth_about/credit_card_debt_3478.html.cfm

Despite the ultra-noble intentions of a genuinely helpful affinity credit card, there are some that also went on their strange ways.  This does not mean these affinity cards are totally useless.  This just means that they have not passed the weather-beaten paths of affinity credit card ideas.  Here are some cards that may not be that strange for some but have come unexpected.

5.  Amphibian Ark: Just a Bit Strange

You’ve heard of the usual environmentally friendly affinity credit card.  There are cards that help save the whales or are up to the usual projects: tree planting and saving bodies of water from oil spillage.  You may know more environmental orgs if you are practically a tree-hugger.  The Amphibian Ark may be seen as simply just that: an affinity credit card that helps save a dying species.(3)  And, why not?  It may be a worthwhile cause to help save frogs and salamanders.  However, there is something suspiciously geeky about saving animals that you normally find icky.  Do not fret though if you have an Amphibian Ark affinity credit card; amphibians may not be as cute as whales and pandas but they are still living, breathing animals that need saving.

4.  Labour Party Credit Card: Mixing Politics with Money, Money, Money

Should you even be shocked that money is involved in politics?  You could be if the issue is about an affinity credit card. Because it is a credit card, it involves debt.  What sort of political party would want to be associated with debt?  Isn’t it a political party’s job to include erasing debts as part of its platform of government?  Now, the Labour Party is probably thinking of the immediate benefits of the move: money for the party to go on with campaign activities. However, the party has been rightfully criticized for the huge 18.9 percent interest rate slammed on its credit card.(4)(5)  This is especially a shameful deal when the issue has arisen smack in the middle of the world financial crisis.

3.  Ducks Unlimited: Quack-y Lifestyle

Ducks Unlimited is part of this list not because it is particularly strange, suspicious, or off.  It is just a little wacky in a serious way(6), if you can understand that.  The organization is so bent on really helping out the environment, especially the wetlands that its whole website is dedicated to conservation.  This is not an organization trying to help out part-time; everything about Ducks Unlimited is focused and patterned after fundraising for its cause.  In its website(7), you will find several other ways in which you can help the cause: through sponsorships or direct donations, through buying its products and through becoming a volunteer.  So the affinity credit card is not really your only chance to help out.  Money need not be involved at all if you become a volunteer.  Yeah, your choice to sign up for the credit card is entirely yours; nobody is pushing to get into debt just to help.  In the end, maybe that is what is so weird about this affinity credit card deal.

2. Bank of America’s Brighter Planet Visa: A Little too Ironic

The Brighter Planet Visa affinity card offered by Bank of America aims to let cardholders do their share by converting every dollar spent into specific points, which can then equal to a ton of carbon dioxide offset.(8)  Now isn’t it ironic that plastic is being used to combat plastic-induced environmental problems? The amount of carbon dioxide emitted by large factories manufacturing an assortment of plastic products from toys to computer chips has an undeniable effect on global warming.(9)  If this is the case, why increase your consumption of plastic products by having a credit card that might trigger spur-of-the-moment shopping sprees?  Plus, many credit cards today are manufactured using several layers of plastic(10), adding to the pollution caused by plastic production, consumption, and waste.  The intention of Bank of America(11) to help the environment is indeed noble, but it’s a bit ironic to lessen global warming by purchasing more and more crappy plastic items you don’t really need.

1.  WXHL Credit Card: When Religion Involves Money

As much as churches are way up there in the list of worthy causes to raise money for, you will not avoid raised eyebrows when it is time to raise money for such an establishment.(12)  It is one thing to support a charitable cause but it seems like a very much different idea altogether to support your church, especially if it is through a credit card.  While church fundraisers may still be under fire from criticisms, it is nothing compared to the reaction a church’s credit card may receive.  Generally, people may accept the idea of an organization helping out a cause via credit card. How would you feel about being encouraged by your church to get right into debt so that you can help?  That sounds very conflicted.  And yet… other churches are joining the financial bandwagon.(13)  What should we expect about the future of credit cards then?  Who should we believe now?  Our financial advisers are telling us to keep the plastic under wraps for now while our church is telling us to go ahead and slide that plastic in.(14)

In the end, it may seem a tad ridiculous to support a charity when your own finances are in shambles.  Affinity credit cards do not seem to care for the benefactor as much.(15)  Think about it: you can always help out a charity or two even if you do not have an affinity credit card.  You only have to regularly set aside cash for your charities of choice.  If you think you need a credit card anyway, you may go for an affinity credit card so that you get to help somehow.  However, make sure you juggle your finances properly or else you will be the one needing charity soon.

Sources:
(1)  http://en.wikipedia.org/wiki/Affinity_credit_card_scheme
(2)  http://www.consumerreports.org/cro/money/credit-loan/affinity-credit-cards-2-08/overview/affinity-credit-cards-ov.htm
(3)  http://www.amphibianark.org/
(4)  http://www.creditcards.co.uk/news/2008/Sep/labour-credit-card-controversial.html
(5)  http://www.debtmanagementtoday.co.uk/newsstory?id=18796574&type=newsfeed&title=labour_party_slammed_over_18_9_credit_card
(6)  http://www.canadiancreditcenter.com/cms/index2.php?option=com_content&do_pdf=1&id=27
(7)  http://www.ducks.ca/aboutduc/news/archives/2006/060526.html
(8) http://www.practicalenvironmentalist.com/global-warming/green-credit-cards-reward-cards-that-help-the-environment.htm
(9)   http://en.wikipedia.org/wiki/Global_warming#Emissions_reduction
(10)  http://www.enotes.com/how-products-encyclopedia/credit-card
(11) http://www3.bankofamerica.com/creditcards/?context_id=marketing_detail&offer_id=ECOMM090QVXG00400800122974EN000&requestTimeout=120&router_flag=y
(12)  http://answers.yahoo.com/question/?qid=20070612045244AAFQmXu
(13)  http://www.allbusiness.com/specialty-businesses/non-profit-businesses/106304-1.html
(14)  http://www.ehow.com/how_2197726_save-cash-feeling-pinch.html
(15)    http://www.independent.co.uk/money/loans-credit/ask-sindie-i-want-to-spend-for-charity-but-not-at-this-rate-511088.html