Debt, Credit Card & Consolidation Current News Digest

This post is from GRS staff writer April Dykman.

Before I changed my habits, I spent money without much thought. In college, if I had a two-hour break between classes, I’d drive to the mall. Once I started working full time, my coworker and I would bring our lunches to work just so that we’d have the entire hour to shop. If I was bored, I’d wander into the cosmetics superstore Sephora for entertainment. Even at home I’d shop, buying online and tracking my packages until they arrived.

I thought I needed a new dress for every event I attended, new clothes from REI for every backpacking trip, and practically a whole new wardrobe if I was going out of town. I thought these new things were a way to reinvent myself or to portray the right image, but all they did was fill up my closets and bathrooms with a ton of Stuff that I’m still sorting through today. (Brokamp’s article on turning clutter into cash inspired me to devote this weekend to more de-cluttering.)

These habits never put me deeply into debt, but they weren’t helping me to get out, either. I was often surprised at what my total at the checkout counter, but I’d throw down the credit card anyway, too self-conscious to put anything back. I’d make a lame promise to myself to cut back, but I never did.

A stop to the splurging
The temporary high of buying Stuff was making me miserable when the credit card bill arrived every month. When I finally had enough of paying down the debt just to drive the balance back up again, I went in the other direction. I quit buying clothes and cosmetics and made my lunch every, single day. It was a strange adjustment to have a packed lunch and a full hour in the middle of the day, without a shopping trip to fill the time. I cut my magazine subscriptions, reduced the minutes on my cell phone plan, carpooled to save gas money, and took clothing to the resale shop. I avoided every expense I possibly could, and the debt was paid off pretty quickly.

The downside was that I found it hard to spend money on anything, even after my husband and I were debt-free and had a healthy emergency fund.

A stop to the miserliness
I remember when it became clear that I needed to assess my relationship with money (yet again) because it was the day that the glass carafe from our French coffee press hit the floor. My stomach turned, and I immediately wondered how much it was going to cost to replace it. I went online and found that a replacement carafe would cost $12. I breathed a sigh of relief, but I also realized that my reaction wasn’t indicative of a healthy relationship with money.

My compulsion to buy had turned into a compulsion to save. Why was I buying all that Stuff? Why was I now so worried about saving every cent, especially since we were out of debt and saving money every month? I filled my need to buy with a need to save, and neither was working for me.

The middle ground
In an attempt to find a balance between debt and spending guilt, I began to think about the reasons why it would be a good thing to spend extra money. I came up with the following situations:

• Gaining knowledge. This year I paid more than I ever thought I would for a business course. Halfway into it, I know it was a good decision that will more than pay for the cost of the course. Paying to learn something useful doesn’t necessarily have to have a monetary return on investment, though. I’d like to hire a swim coach to improve my skills, which won’t make money but does provide a great physical workout. I don’t feel badly about spending money when I will learn something of value.
• Experiencing something new. This one can overlap with gaining knowledge, but I felt it was still worth mentioning separately. Experiencing something new can mean travel or taking lessons in something that interests you.
• Paying for quality. The quality of the food I eat is a high priority to me, so I’m okay with spending extra in that area. Another example is the aforementioned clothing habit. I’ve come to adapt the quality over quantity stance when it comes to clothes. If I actually need something, I’ll buy it, but I want it to last and I’ll pay a more for that (and an upcoming wedding is no longer considered a need for a new dress).
• Supporting important causes. One example of a cause that I support is buying locally, so I’m okay with spending extra if it’s supporting a local business. You can lobby for many causes just by mindfully choosing how and where you spend your money.

Determining when I’m okay with spending has helped me to find a balance between mindlessly consuming and mindlessly saving. When are you okay with spending more money? Why do you value those things?

J.D.’s note: I went through this exact same thing. When my frugality paid off, when I got out of debt and built savings, I still couldn’t spend on myself. Does everyone go through this? It wasn’t until I re-discovered the balanced money formula that I was able to loosen up again and budget for fun. I’m much happier for it.

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• Lifestyle Trade-offs: Being Frugal While Having Fun
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Spring man with cache of others' credit cards is sentenced Houston Chronicle When postal agents broke down the door of a Spring man's home last April he was on a cell phone and had two credit cards in his hands that …

This guest post from the redoubtable Tyler K is part of the new “reader stories” feature here at Get Rich Slowly. Some reader stories contain general “how I did X” advice, and others will be examples of how a GRS reader achieved financial success — or failure. Tyler is an active commenter at GRS, and never afraid to share his opinion!

Like J.D., I once had a big problem with debt. Unlike J.D., I didn’t dig myself out from under that problem gracefully.

About eight years ago, I was a college student, living in an apartment near campus, and working full time while going to school. I felt like I was on top of the world. Here I was, seeing all my friends making $6 or $8 an hour, while I was making about $17. That seemed like a lot of money. It was about $35,000 a year — not just a college student’s salary, but a real salary. I felt like I deserved to be living it up a bit, especially considering all the work I was doing with a full-time job and a full time class load.

I went overboard. I spent well beyond the $35,000/year I was making (it wasn’t as much money as it felt like). I bought a Mustang, and modified it into an amateur race car. I had the latest laptop and a desktop computer with a flat screen display (in 2001). My $35k/year salary was enough to live on, but it wasn’t enough to support spending $1500 on a laptop computer and on a desktop computer and on high-performance cylinder heads, but that’s what I did.

I bought all of them, and more.

This kept up for a year or two. I kept justifying these purchases to myself, and my credit card balances slowly rose along with my required minimum payments. A bout of bad luck exacerbated the problem. I was mugged outside my apartment, and having no medical insurance, ran up an emergency room bill. My race car was stolen, and being 21 and owning a race car, I couldn’t afford comprehensive car insurance, I had liability only. I bought another car to replace it, again with borrowed money.

Things fall apart
Eventually, I realized I was in over my head. I was gasping for air. I couldn’t make my credit card payments and also pay my rent and buy groceries. I was driven to the edge, and I gave up. I stopped paying all my credit card bills, and they went into collections. I voluntarily surrendered my car to be repossessed. I figured if I was going to ruin my credit score, I might as well go all out — I even hired a bankruptcy attorney. She managed to stop the incessant flood of phone calls from creditors, but I found I couldn’t afford even to pay for the bankruptcy proceedings, and so that process stopped shortly thereafter.

At this point, I owed approximately $30,000 on about four different credit cards, the medical bill, and the car loan, all of these in collections. My credit had been destroyed, but my creditors had been silenced by the bankruptcy attorney. I decided to get my life in order and worry about paying back the debts I owed later. It was easy to justify — I could barely put food on the table and the credit card company was still bringing in billions every year. They didn’t need an extra few thousand dollars as desperately as I did. So I let my debts ride, and worked on running my life in a sustainable way.

Turning things around
The first thing I did was give up credit cards entirely.

I decided to only spend money I actually had, and so my purchases of toys slowed dramatically. My extravagances in life dropped to going out to eat with my roommate a couple times a week, and not at particularly fancy places. I got into bicycling as a hobby, on a used, mid-range road bike — not a brand new, high-end model like I would have bought before. And there I sat, content with the computer I already had, my modest bicycle, and the occasional trip out for dinner. I was living quite comfortably on my salary with my new outlook on life. For the first time in years, I felt comfortable with myself. I actually managed to save a few dollars from paycheck to paycheck instead of spending them!

I did decide that I needed a car, though. I hadn’t enough money to pay cash for one, and I doubted anyone would give me a loan, so still being young and in school, I asked my parents to help. This time though, I was much more conservative.

I borrowed about $5,000 from my parents and created a definite plan for paying them back. I bought a nine-year-old but well-maintained Honda Accord, and I stuck to the payments religiously. This time if I were to fall behind, not only would I give up my newfound peace I’d made with myself financially, but I’d be letting my parents down instead of faceless mega-corporations.

No credit needed
Shortly thereafter, I finished school, and took a software engineering job in San Francisco. Rents were higher in the city, but my salary doubled. My brother needed a car, and I worked out a deal with my parents to give him mine, along with the rest of the payments on the loan. I wanted to get a brand new one.

I went down to the car dealership with my pay stubs from my new job, and my ruined credit score, and a pre-approval I’d gotten online for a loan of up to $26,000. I was determined to make something work. As it turned out, this was easier than I’d anticipated. Car dealerships will do anything to sell cars, and that includes selling cars to people with horrible credit and a repossessed car on their credit report. I bought this car with no money down, which in retrospect, is the stupidest financial decision I’ve made since I began my financial recovery.

Still, it wasn’t a horrible decision — I now made a salary that could justify a car like this. Sure, I got a crappy 12% interest rate on the loan, but I eventually refinanced the loan to 10%, and a shorter term, and then I paid the loan off early, about two-and-a-half years after I first bought the car. When I called the bank to pay off the first loan (when I refinanced), they were practically begging me to take a credit card from them, seeing as I’d overpaid my car loan every single month, on time, for the life of the loan. But still, I wouldn’t break my ‘no credit cards’ rule, and I refused.

Renting an apartment was another thing I was scared to do with bad credit, but it turned out easier than I thought, as well. I got my first new apartment with my ruined credit when I moved to San Francisco. I decided to share a place with a friend of a friend. We found a two-bedroom place listed on Craigslist, and went to see it. It was a four unit building, quite common in San Francisco, owned by a little old Chinese lady. She didn’t care to even run a credit check. Two well-dressed young men showed up, with pay stubs indicating an above-average combined annual salary, and job titles of ‘Software Engineer’ and ‘Accountant’. She was more than happy to rent the place to us for $1800/month.

I continued my life living the way I had since I’d given up on my debt a few years ago, but now on a much larger post-college salary. I bought few toys, aside from the car and some furniture. I’d go out to eat with friends sometimes, or I’d go out for drinks occasionally with my new coworkers. I actually found money piling up in my checking account because I was making it faster than I even wanted to spend it. I had nothing I needed to buy.

After a year, my roommate took a promotion that had him moving from San Francisco to Denver. I decided that I wanted to get my own place, but $1800/month was too much for me to spend by myself. The little old lady who’d been our landlord actually asked if we’d reconsider staying, and if I could find another roommate, as we’d been such good tenants, but I told her I had to leave.

I was questioning my ability to get lucky with finding an apartment a second time, but figured I’d done it before, and I could do it again. I looked at one place I like, and decided to take it, but was turned down by the rental agency due to my bad credit. I found another place a few blocks away that actually ended up being nicer — It was an old Victorian house divided into two units, one upstairs and one downstairs. The family that owned the place lived upstairs and rented out the downstairs.

Wary because of my bad credit and previous rejection, I wrote down my story, and gave the owners my bank statement showing the money I’d accumulated in the last year I’d spent living below my means, and the phone number of the landlord that’d asked me to stay in San Francisco. In light of this information, they rented to me regardless of my credit score, and they too ended up extremely happy with me as a renter.

The road to recovery
Several years after I’d given up on my credit card bills, I was finally contacted again by one of my creditors (or really, the collection agency to which they’d sold my debt). They demanded, in a rude and threatening manner, payment in full of an outstanding debt over $10,000.

My girlfriend (now my wife), who worked at a law firm, asked a co-worker of hers to help me out. He was an attorney who had previously worked in this specific area, representing clients being sued by creditors, and had no sympathy for a threatening collection agency. With a single phone call on my behalf, he had the collection agency offering a settlement of about half their initial demand. I paid it in full from the surplus I’d been accumulating.

Slowly, over the course of several years, my other creditors would contact me, and we’d agree on a settlement like this. Eventually, the statute of limitations for them to collect on the debt through legal channels expired. After that, all I needed to mention to creditors was that I knew it was too late for anyone to sue me, and I’d have a reduced settlement offer.

Now, at the beginning of 2010, it’s been nearly seven years since this whole mess started, and these old marks are due to start dropping from my credit report soon. Surprisingly, I’ve found in the intervening time that I haven’t been impacted much at all by my poor credit — certainly not as much as you would have thought, given the emphasis the financial media puts on credit scores.

• I paid maybe 5% more than market value for the car I financed, not a huge deal.
• I was turned down for one apartment rental.

I’ve since rented one other place, where I live now, in a manner similar to the second — it’s a privately-owned little house with landlords that live next door.

I told them my story, showed them my bank statements and pay stubs, and they were happy to rent to me, and I love it here. Aside from the lousy car interest rate and a single apartment rejection, I haven’t even noticed my poor credit score. Employers haven’t cared. Cell phone companies haven’t cared. The electric company hasn’t cared. For the most part, nobody but myself has even looked at my credit score for the past six years.

While all this has been happening, my life otherwise has been going fantastically. My career has progressed well, I make roughly four times what I did when the story started. I got married. I moved back to my hometown, which I love. I’ve been traveling a bit, to five other countries and various places in the US. My life is going as well as I could hope.

Strangely enough, I’m not sure that any of this would have happened if I hadn’t given up on those debts years ago. That began a change in lifestyle — a focus on experiences instead of things, on making do with what you have instead of needing the latest and greatest. Those lessons have shaped my life since then, and I don’t know if I would have learned them as well without going through that experience.

Final words
I was originally hesitant about sharing this story. I was afraid of being judged for the method I used to pay off my debts. I’m not proud about having done this, but at the same time, I don’t feel bad about it.

These credit card companies were willing to do everything in their power to make a profit off me. They had teams of actuaries calculating the exact interest rates and credit limits that would maximize profits from their customers, and they had the legal system at their disposal if they thought it would have been beneficial. I used the same tactics. I was never sued and in the end, I came to mutual agreements with my creditors that satisfied both parties.

Was it an ideal solution for either party? No, but once I was in in over my head, there wasn’t a realistic ‘ideal solution’. The situation was eventually salvaged, and now, years down the line, it’s water under the bridge.

Reminder: This is a story from one of your fellow readers. Please be nice. After nearly a decade of blogging, I have a thick skin, but it can be scary to put your story out in public for the first time. Remember that this guest author isn’t a professional writer, and is just learning about money like you are.

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Related Articles at Get Rich Slowly:

• My Parents Ruined My Credit!
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• Credit Card Companies Are Closing Unused Accounts
• Your Secret Credit Scores
• Reader Question: Buying a House Without a Credit History?

Technology was supposed to make our lives simpler and save us time. In many ways, it's done just the opposite. Last month, we took a look at how often our gadgets let us down, and how screen-based devices are literally rewiring our brains and robbing people of focus and social skills.  But we left one of the more obvious techo-fear topics — information overload — for another day. 

A new study from the Pew Internet and American Life Project suggests consumers are coping with the avalanche of information they receive in unexpected and often successful ways.  So today we’ll discuss of both that silver lining and the grey cloud inside of it.

Having all the world's information, and very nearly all the world's people, just a click away seems like a fantastic development for humankind. But how much is too much?

The Economist magazine recently reported that the total amount of information in the world is growing 60 percent annually, and that U.S. households digest 34 gigabytes of data per person per day.

That's not information overload; it's practically electrocution.  But the Pew study sheds some light on how U.S. consumers are dealing with the surge — they're getting a little help from their friends.

In a new report called "Understanding the Participatory News Consumer," Pew says that one third of consumers have commented on news stories or shared them through social networking sites, half "rely on people around them to tell them when there is news they need to know," and 8 out of 10 get or share links in e-mail.

"Consumers are using social networks to filter, assess and react to the news," the report concluded. 

In other words, one sure-fire way to build Web traffic is to get a social network user to yell at all their friends, "Hey. Look at that!"

"Yes, there is a lot of that going on," said Lee Rainie, who runs Pew's Internet research. "People are getting their news through recommendations in social spaces."

New participation, new loyalty

Those are just a few of the findings in the Pew study, which suggested that consumers are driving news creation and even story selection like never before.  In a moment, we're going to ask you about the ways you consume news and deal with information overload.  But first, here are more tidbits from the study.

Click to join the fight against Red Tape 

 

While the changing online news user seems loyal to their friends and their recommendations, loyalty to specific online news brands is evolving differently. Only 35 percent say they have a favorite place to visit for news — contrast that with consumers' relatively fierce loyalty toward Coke or Pepsi, Burger King or McDonald’s. 

"There is some level of loyalty but it's striking that people didn't say, 'Oh yeah, all the time, I am always checking out this Web site," said Rainie "We didn’t expect that. We thought people would have a favorite, even if they were just 'grazing' on news. We were betting the percentages would be reversed."

On the other hand, Web users are loyal to a small family of Web sites they trust.  The majority of online news consumers (57 percent) visit only two to five Web sites to stay updated.  Only one in 10 users said they regularly visit more than five news sites.

Rainie cautions people on comparing the loyalty numbers to other media or other consumer products. Many people prefer one news anchor to another, or prefer Coke to Pepsi. But clicking on a Web site or blog represents a different kind of choice.  Picking Coke necessarily means picking against Pepsi, and watching one network means not watching another. But on the Web, people are free to split time among multiple sources. 

"You are not being disloyal if you click on a link from someone to another Web site," he said. There’s no rejection involved. Online, people simply follow a click trail. "On the Web, it's more like an impulse buy."

With consumers trusting a circle of friends to keep them updated, professional journalists are becoming just another member of this intimate circle that serves as filter, Rainie said.

“A notable number of Internet users are beginning to treat news organizations, particular journalists, and other news mavens as nodes in their social networks,” the report found. Fully 57 percent of U.S. adults use a social networking site, and 97 percent call themselves online news consumers.

New platforms

Pew's research makes obvious that consumers are faced an ever-growing list of choices. Fully 26 percent of U.S. adults, 33 percent of cell phone owners and 88 percent of mobile users are what Pew calls “on the go” users, meaning they use the Web to access news on their phones, the study found.

Meanwhile, "participation" in news is nearly as popular.  Commenting on news stories — as readers do on the Red Tape Chronicles or Newsvine — has become almost a mainstream activity, with one in four respondents saying they'd done so. “On-the-go” news users are even more dedicated, with half saying they had engaged in personal commentary.

On the other hand, despite all the talk about Twitter (which just passed its the 10 billion Tweet milestone), only 3 percent of users said they'd Tweeted about news.  Twitter updates – either from professional journalists or friends – were the least commonly used news source among the general population, the study found.  But Twitter users are an intense and devoted bunch. Nearly 100 percent are engaged in sharing news online and in other forms of participation.

Tools vs. overload

This level of active participation is not what you'd expect from a group of consumers cowering under the mountain of data headed their way every morning. This group is not disengaging because they can’t keep up. In fact, the Pew study shows that people who participate in news stories are much more likely to follow that story over time, and to care about the outcome.  It's a mixed bag, Rainie said.

"Information overload is part of the story, but not the whole part," Rainie said.  "Some people are participating because they have so much choice in news and in life. Some people are probably disengaging.  But some people are more engaged. …  Some people do it because they can.  The tools (for participating) are very good now."

Meanwhile, almost half of Web users (44 percent) say they have signed up for nifty technology that lets “the news find them,” Pew said.  They use an alert service, automated Web site updates, e-mail, or social networks to get headlines and stories delivered right to their screens. Slightly more than one quarter of Web users say they receive such passive news delivery at least once a day.

News snackers vs. deep divers

Clearly, some news consumers have changed their habits. Instead of spending 60 minutes reading a newspaper or 30 minutes watching a newscast, they might spend 5 minutes on a Web site or even just 60 seconds scanning headlines posted by friends on Facebook . This group is sometimes referred to as "news snackers." Rainie calls it "drive-by" headline scanning.  There's concern that this group is learning less about their world and will be less able to participate in the political process. But ever here, Rainie cautions against generalizations.

"We didn't ask equivalent questions in 1976, like ‘How many of you are done with the newspaper in 3 minutes,’” he said. “Obviously, some people just scanned newspaper headlines, too. Meanwhile, people who care about a subject now have a lot more opportunity to get documents, video clips, and commentary. They have the ability to dive deeply into stories, sometimes for hours."

It's far too optimistic to suggest news consumers are winning the war on information overload, but Rainie thinks the new tools have at least given them a fighting chance.

"People are learning how to arrange the information universe around them, and learning how to be on alert in an environment that has this capacity," he said.  "They are learning to open themselves up to more input from friends, and they can customize their sources to focus on subjects that matter to them.  The technology is quite robust for doing these things."

But not everyone is being taken along for the ride.  Lurking behind this debate about the new news consumers is a potential widening of the digital divide. Will consumers who don't Tweet, use Facebook, leave comments or post cell phone video fall ever further behind? While about one-third of the Internet audience is now fiercely engaged in posting news stories, arguing online or linking to video clips within sophisticated social media sites like Facebook, a host of other Americans don't have high-bandwidth access or the know-how to get involved.

"This is a long-standing concern of political scientists in general," Rainie said. "Even before the Internet there was a lot of evidence and research that people who were not deeply engaged with communication didn't take advantage of media sources, and, how would their voices be heard? … Online news participants are still upper class and well educated.”

This might leave consumers with a stark choice: participate or perish.

"People have to either be engaged, or be left out," he said.  "Many people lack the technology and the tools to take full advantage of this new environment that gives them the capacity to be more involved.  We have to make sure that there is fundamental access to the new tools for participation.” 

What about you? Do you feel more engaged or more overwhelmed? Are you using new tools like Twitter and Facebook as much as Pew thinks you are?  Do you like participating in debates on blogs like the Red Tape Chronicles? Have you personalized news sources? Are there other news and information tools you are craving, or that you imagine would be helpful?  What subjects would you like to hear more about?  Leave your comment here, or if you prefer, discuss on my Facebook fan page, follow me on Twitter, or Tweet about this story to your friends.

You probably have a workout buddy. You might have a dieting buddy.  Maybe you are part of a moms' support group or a car pool. Perhaps you decided to run a half-marathon this year, but only after one of your friends promised to train with you. 

So why don't you have a stop getting ripped off buddy?

We all know the power of social commitments and positive peer pressure.  It's oh so much easier to wake up at 6 a.m. and go running when you know a friend is waiting for you at the corner — and you'll face her mocking wrath if you don't show.

We also know that everyone hates overpaying for credit cards, pay TV or cell phone service — yet we're all busy and hate the hassle of fighting back. We're distracted, we dread all the time spent listening to hold music, we fear rejection.  We know we should, but we just don't get around to it.

Now's your chance to take a stand.

We're going to harness the power of public commitment to motivate one other to take on unfair fees and charges.  Today, we're starting a new msnbc.com feature — the Red Tape Fight Pledge.  Click now to join a Facebook group devoted to helping you take on companies and monthly bills that just aren't right.  Pledge to spend one hour in the next 30 days fighting against a company that’s trying to take you to the cleaners, then come back and tell everyone how you did.  Your stories will be part of upcoming msnbc.com Red Tape Chronicles reports.

But more important, you'll have made a public commitment to make that phone call or write that letter you've been putting off. To give up that one lunch hour to make sure your cable company isn't overcharging you. And you'll swap success stories and tips along the way.  Found a phone number that worked? Great. Have a Web site that helped you find the right customer service department?  Tell everyone. And if you hit a brick wall, share that too. You might find an answer from a compatriot here.

To kick start the effort, here's a few ideas

*This month I will call my pay TV company and tell them I want the same discounted deal they give new customers. Why should I be punished for being loyal?

*I'll research a new credit card.  My bank has hiked my rate and lowered my limit, so it's time to shop around for new plastic. I tried 6 months ago, but I think it's time to try again. Things may have changed.

*I hate my bank, so I will research small community banks and credit unions.  I hear it takes a little effort to switch, but one solid lunch hour might be enough.

*I will carefully examine my 401(k) holdings. I've heard that some mutual funds have high expense ratios, and that those fees could eat up one-third of my retirement fund before I reach 65.  I will switch to low-cost index funds instead.

There are plenty of others.  So jump over to the Facebook group now and leave your pledge. And remember to come back within a month and tell us what happened.  We'll offer helpful reminders right in this space.

Now, fight for your money!

CLICK HERE TO JOIN THE 'RED TAPE FIGHT PLEDGE' on Facebook. 

(In this case, comments won't be accepted on today's blog. Place your comments on the Facebook group, please.)

 
Progress seemed inevitable when Disney's Carousel of Progress ride opened in 1964. Not anymore. Image courtesy, Disneyworld.disney.go.com

Lately, Internet users have been poking fun at each other at record rates, using sites with names like EPIC FAIL to chronicle technological foibles and missteps. Perhaps they are laughing to stop from crying.

Technology letdowns such as dying cell phone batteries or lost computer files can to lead to everything from pesky annoyances to computer rage, clinical depression, or worse. A growing body of research suggests that the invasion of the digital age is literally rewiring our brains, eroding skills once considered essential for a happy adult life. Gadgets were supposed to make our lives easier and save us time. Instead, we are more stressed and have less time than ever. What is the cause of this epic failure?

The modern digital age was born, most agree, in 1964, with the invention of the transistor. That same year, millions of Americans were carried into the modern era by Walt Disney's "Carousel of Progress" ride, invented for the 1964 World's Fair.  The ride offered a quick look at five eras in American history — beginning with a housewife complaining about spending five hours doing laundry. In the last scene, "The glories of today" are revealed, with clean modern living and "a kitchen that all but runs itself." The happy result: seemingly boundless leisure time.  Visitors left the ride humming "Great Big, Beautiful Tomorrow."

We're still waiting.

"Technology promised us extra time. Well, that didn't come true. We are shorter of time now, busier, then we've ever been as a society," said psychologist Michelle Weil, author of the book “Technostress.”

Technology has filled our world with modern miracles — instant global communication, frictionless commerce, information available to all for free and, most important, millions of lives saved and improved by medical science. But all this progress has not come without a price. It would be ignorant to argue that technology hasn't made the world better. But often we are blind to the fact that technology creates almost as many problems as it solves.

"We weren't prepared for that,” Weil said. “We were prepared for a smooth ride literally. We were not prepared for more issues in our lives. We have enough issues."

Working in an office with a poor cell-phone signal. A laptop battery that won't hold a charge any longer.  A car charger that short-circuits when the oversized coffee cup falls out of the cup-holder and spills.  These daily headaches — let's call them technoflubs — have become a way of life. Stack them together in one bad day and you have something Weil called technology's version of a "bad hair day." String a few of those bad days together and you get something much worse.

"When gadgets let us down, we feel frustrated, stumped, upset, scared, we feel stupid, like we did something to mess it up, and we feel helpless,” she said. “Those are all the same feelings you have when you are depressed. The issue is literally a dependency issue, and it works like any other kind of dependency on alcohol, drugs, gambling, sex. We have come to expect technology to do certain things for us, and when it fails — which it does often — and we have no clear answer, we become depressed."

And sometimes, says Professor Kent Norman of the University of Maryland, we rage.  Five years ago, Norman introduced the world to the term "computer rage," following the viral success of a series of YouTube videos showing frustrated users smashing their suddenly impotent PCs into bits.

Failure by the numbers
There isn't great data available on the number of technoflubs that U.S. consumers encounter every day, but the Pew Internet and American Life Project took a stab at an estimate two years ago. Here are the sobering results.

*Nearly half (48 percent) of adults who use the Internet or have a cell phone say they usually need someone else to set up a new device up for them or show them how to use it.

*44 percent with home Internet access say their connection failed to work properly for them at some time in the previous 12 months.

*39 percent of those with desktop or laptop computers have had their machines not work properly at some time in the previous 12 months.

*29 percent of cell phone users say their device failed to work properly at some time in the previous year.

*26 percent of those with Blackberries or other personal digital assistants say they have encountered a problem with their device at some time in the previous 12 months.

Can't be fixed
What can consumers do when their gadget breaks?  Generally nothing.  Unlike old-fashioned mechanical devices, few electronic devices have user serviceable parts, making consumers even more helpless and vulnerable to failures. 

"Think about a car. Your grandparents could fix basic problems that a Model T had. In fact, a prerequisite of owning a car was that you could fix it,” said Lee Rainie, a Pew project spokesman. “Now, you just have to take a (broken gadget) into the store and ask for help.”

And break, they will. You may love your simple phone, and that basic PC might be good enough for your mom to type letters and e-mail, but the idea of owning an appliance until it dies a natural life is antiquated.  Given the perpetual upgrade cycles, software patches, network requirements and so on, gadgets are not built to last.

"If you have a phone you like and it breaks, you can't get that phone again; it's gone," Weil said. "You only have the choices they give you."

Even on days when our computers and gadgets don't fail us, the pressure is always there, Weil warns. Cell phone users spend many evenings glancing nervously at their battery strength, hoping the gadget will work long enough to accept that critical phone call on the commute home.

 "We think about looking at our batteries more than we think about eating," Weil said. "You constantly have to bring the charger so you can plug it in in the car. You have to make sure you plug it in at night or you are going to have difficulty. It's another thing you have to think about all the time."

There are varying degrees of failure, of course. When a car breaks down in your driveway, it's far less serious than a breakdown in the middle of the Arizona desert.  But if technostress seems to be growing, Rainie said, it's because we are taking far more trips through the digital desert these days.

"The problems that people have grow in urgency the more they rely on their technology,” he said. “Our expectations for technology are growing. The frustration is in direct proportion to dependence on the instrument. Once you become used to perpetual contact with everybody, all of the sudden the loss of contact becomes a much more meaningful thing."

Constant conversation
Richard Ling, a technology professor at the University of Copenhagen, has been studying the concept of constant contact for a decade.  No longer do people call each other at home or at work, hoping to find them. Smart phone mean that calls, texts, and e-mails always find their targets. That means friends and family are never really separated.

"This is a constant conversation we are in, an ongoing dialog," Ling said. "I know what's going on with people I care about at a different level now. I know what's in the refrigerator at my friend's house."

Some consequences of this are obvious — the drunken text or the raging e-mail that we regret moments after sending.  In the past, time and distance might have served the function of "taking a deep breath." No more. Instant communication means having to say you’re sorry.

Other downsides might not be so apparent.  Being in constant connection with friends, family or employers can be both stressful and demanding.

But in a more subtle way, constant contact seems to be cheating people of the ability to plan, and to commit to plans, Rainie said. Witness a typical negotiation among teens or 20-somethings about Friday night fun.  The discussion begins with frantic texting during seventh period, or at 3:30 p.m.  Rendezvous places are picked and discarded, and meeting times considered mere approximations. Texting continues as the night begins. "Running late," "I'll meet you inside," and then, "It's lame here, let's go the other bar instead."   The mental satisfaction of having a plan come together never arrives.

'Continuous partial attention'
Some experts think these subtle changes are causing great harm to our neurological well-being.  Gary Small and Gigi Vorgan made a series of dramatic claims about the way digital devices are rewiring young brains in their 2008 book “iBrain, Surviving the Technological Alteration of the Modern Mind.”  Most of their assertions aren't pretty. Given that adults commonly consume two, three or even more gadgets at once now — all while carrying on conversations with people – they are beginning to lose their ability to focus and concentrate, they say. They describe a phenomenon called "continuous partial attention," a state of divided attention which leaves people unable to perform tasks that require concentration. Worse, it leaves its victims less and less able to connect with and empathize with each other, they said. 

"When our minds partially attend, and do so continuously, we scan for an opportunity for any type of contact at every given moment," they wrote. "(People) no longer have time to reflect, contemplate, or make thoughtful decisions. Instead, they exist in a sense of constant crisis — on alert for a new contact or bit of exciting news or information at any moment."  Under that kind of stress, the brain secretes cortisol and adrenaline, creating a temporary high followed by depression, leading to something the authors call "techno-brain burnout."

In children, the effects can be worse, they said.  When face-to-face contact is replaced by excessive digital media, a child's neural circuits can atrophy and the brain may not develop normal interactive social skills. Small and Vorgan believe this is a big problem, and that a class of young heavy media users they call Digital Natives are suffering from extreme antisocial tendencies.

"Several studies in both children and adults … tie frequent technology use to conditions such as ADD, ADHD, autism, depression, anxiety and even sociopathic behavior," they said.

The Dumbest Generation
Emory University English Professor Mark Bauerlein sees other risks in this phenomenon, and laments them in his book, “The Dumbest Generation: How the Digital Age Stupefies Young Americans and Jeopardizes Our Future. “ He's worried that technology that was supposed to make our kids learn faster and smarter is actually robbing them of the ability to think.

"The Internet doesn't impart adult information; it crowds it out," he wrote. Students — even top college students — read rarely now, and the slang used for online chatting is eroding writing skills.

Bauerlein's work was featured in a new PBS documentary “Digital Nation,” which premiered this week. The show took on the issue of divided attention, quoting professors who struggle to keep the interest and attention of students they know are playing with Facebook during class.  While the professors complained, students asserted that they were perfectly capable of effectively multitasking.

Hardly, Bauerlein argues. Students may manage to pass tests in school, but thanks to distractions the students retain little knowledge required for culture, citizenship or good consumerism.  The reason Jay Leno's "Jaywalking" segment — when random adults seem unable to answer basic questions such as how many stars are on the U.S. flag — is so funny is because it's true.

Sticking up for tech
There are many valid defenses for technology.  It's just a tool, of course — the Internet doesn't kill brains, people kill brains.  Obviously, a tool that allows people to find virtually any fact ever known within a few seconds can help make people a lot smarter. 

Even Weil, the “Technostress” author, is quick to say that technology is not the problem: "The problem is the way people use technology, and the expectations they have for it," she said.

People have come to depend too much on gadgets, and fail to plan for the logical possibility that they will occasionally break down.  Having simple backup plans in place – in case my phone dies, I’ll meet you at 8 – can relieve much of the dependency-related stress.

Meanwhile, too much alcohol, too much chocolate cake, too much exercise  – all these things can be bad for people, just like too much digital exposure. Most technology reporters who cover the dark side of the Web — porn, gambling, privacy, electronic crime — eventually come around to the notion that technology changes nothing.  All those bad habits existed before the Web and continue to exist in spite of the Web.  It's fair to ask, then, where the fault lies for "The Dumbest Generation" — with overexposure to digital media, or with adults who don't force the kids to turn off the laptops and listen once in a while.

Blaming youth would be a mistake, too, as brain studies show the deleterious effect of too much digital media impacts all ages.  In fact, older people are less equipped to deal with overstimulation and hyperconnectivity. 

Meanwhile, Ling offers this reminder: Global connectivity creates millions of small success stories every day. Unlike television, which can be isolating, cell phone technology can help create feelings of true intimacy. 

This week, his daughter bought her first computer and called him on her way out of the store.

"I was able to share that exact moment with her, even though she was 2,000 miles away (at school). Now that was wonderful," he said. 

Become a Red Tape Chronicles Facebook fan or follow me at http://twitter.com/RedTapeChron

This guest post from Amanda is part of a new feature here at Get Rich Slowly. Every Sunday will include a reader story (in the new “reader stories” category). Some will be general “how I did X” stories, and others will be examples of how a GRS reader achieved financial success.

In May of 2008, I graduated with my MBA from a great school. I went straight from my undergraduate career into an MBA program, so despite numerous internships, I didn’t have a great deal of work experience, nor did I have a nest egg of any kind. Luckily, what I did have was a CPA for a mother who taught me the value of saving a buck when I was very young.

I also was able to go to school on a partial scholarship and applied for numerous others while in the program. With all this said, I went to four years of college and two years of an MBA program and came out with around $37,000 in debt.  That’s a large number to swallow; however, as far as education goes, I still look at that as quite a bargain.

Back in May 2008, I was 24 years old with $37,000 owed to good old Sallie Mae. I was starting my first full-time job in June, with a salary of $65,000 plus bonus potential. It wasn’t the $90,000 others from my class were making, but I thought I was doing very well considering I wasn’t yet 35 and I wasn’t moving to a big city (like NYC or DC).

Fast forward to today, roughly a year and a half later: I have $8000 left to pay on my student loans. I also have an emergency fund of around $17,000 and have over $15,000 in my retirement accounts. I’ve gone from having about $1000 to my name (net worth of about negative $36,000) to today where my net worth (emergency fund plus retirement accounts minus remaining student loans) is approximately $24,000. I’ve paid off $29,000 and saved $32,000 in a year-and-a-half: a total of $61,000.
 
How did I do it? I didn’t live like a pauper, but I did and do live frugally. I didn’t do anything that any of you haven’t heard before. I have no secret that hasn’t been revealed on personal finance blogs, but nonetheless, here’s the laundry list of how I’ve tackled my debt and built my savings:

I set goals! Before I began working, I set up my budget and set stretch goals for each month on what I could save/pay off.

I paid myself first and automated my finances. I immediately set up my 401(k) with my company. I set my contribution rate to 10% and didn’t concern myself with company match whatsoever. I figured if I never knew what it was like to have that 10% in my paycheck, I’d never miss it.

I also took a couple hundred bucks (it adjusted over time so there isn’t an exact figure to put here) from each paycheck and immediately moved it over to an ING Savings Account that I set up to build my Emergency Fund. Finally, I set up a Roth IRA where any excess cash could go at the end of each month.

I got a roommate. I wanted to live in a nice, safe area with a pool and a gym. It didn’t have to be the Ritz but I wanted it to be a place I was happy to call home. After looking at the prices of such places, I knew to accomplish my financial goals, I was going to need to get a two-bedroom and split the rent. I found a great roommate and split everything down the middle with them. This kept my rent and utility bills far under the 33% suggested rate. (I paid approximately $650 in rent for those of you who like exact numbers.)

I negotiated on all utilities and kept them to a minimum. I didn’t get a home phone number; my cell phone was all I needed. I had regular cable (no fancy movie channels) and regular internet through a bundle package. I negotiated these rates to the absolute minimum offered and when they tried to raise them, I called the cable company and told them their services were not worth that amount and that I would like to cancel. It was easy and fast and worked like a charm.

I kept the heat and A/C on at limited levels. If it was hot, I used a ceiling fan rather than pump A/C through the whole house. I opened the windows and let the breeze cool off the house. When it was cold, I used heat but also wore socks, sweatpants and a sweatshirt so that I could be warm without making my house a sauna. I used a drying rack as much as possible to save on dryer costs. It also helps keep your clothes from wearing out — an added bonus!

I learned the art of couponing at the grocery store and taught myself how to cook. Every Sunday, I faithfully clipped coupons and used sites like Coupon Mom or Frugal in Virginia to help me match coupons to sales to get the lowest prices possible.  This seemed daunting at first but quickly became a ten to fifteen minute routine which often saved great deals of money

I didn’t buy pre-made food: I cooked from scratch. I found this was cheaper and far healthier! All Recipes was a great and free resource so that I didn’t get bored with the same old meals.

I bought produce that was in season so I could still get fresh fruits and veggies.  I also stuck with apples, bananas, and pears instead of their more expensive berry counterparts. I ate vegetarian a few meals each week.  I didn’t completely take meat out of the equation but did limit my intake of it. I also grew my own. I couldn’t have a full garden but I did grow tomatoes on the back terrace. 

I didn’t eat out often! I probably ate out once to twice a week to keep up with my social calendar.  Instead of eating out, I invited friends to my house or met them for a pot-luck. Finally, I brought my lunch to work almost every day.

I didn’t buy Stuff. Don’t get me wrong: If I wanted something, I bought it. I just evaluated whether it was something I really needed or if that want was only temporary. Usually, I’d wait a week to see if I was still thinking about the item. When I did shop, I used coupons at the stores and Retail Me Not when shopping online. I also shopped the sale section first.

I used the library and swapped books/DVDs with friends. Instead of hitting Barnes and Nobles, I went to the library or did PaperBackSwap. I’ve never been left wanting for something good to read or watch.

I worked out and spent a lot of time hiking outside. Hiking and enjoying the great outdoors is healthy, fun and free! I also did live in a beautiful area for hiking so was very lucky in that regard.

I worked hard at my job. I busted booty to get bonuses and raises at work. I made sure that I gave 110% and that my bosses were happy with my work. Any extra money (bonuses, tax returns etc) went straight into loan repayment after a small celebratory dinner of some kind.

I made side money.  This also went straight into loan repayment. I used eBay to sell items I didn’t want/need anymore. I sold books and DVDs that I no longer wanted on Amazon. I did Swagbucks. It’s amazing how easy it is to get those $5 Amazon gift cards. It’s essentially free money!

Basically, I just didn’t let myself fall victim to lifestyle inflation. I didn’t need to have the latest Coach purse or a brand new car. I took good care of what I did have and bought nice things without the ridiculous price tags. I didn’t blow money at the bar, and I built my social calendar on less expensive outings with friends (picnics, free concerts, dinner parties etc).  

I turned my debt repayment into a game where it was fun to send in that big payment and I turned any shopping into a quest for a great deal. It won’t work for everyone, but it worked for me!

Reminder: This is a story from one of your fellow readers. Please be nice. After nearly a decade of blogging, I have a thick skin, but it can be scary to put your story out in public for the first time. Remember that this guest author isn’t a professional writer, and is just learning about money like you are. Photo by fotographix.ca.

—
Related Articles at Get Rich Slowly:

• The Turning Point
• Reader Story: Tackling Debt Through Volunteer Work
• links for 2007-01-06
• Save or Spend? The Tax Refund Dilemma
• Reader Success Story: Debt Free on $2,000 a Month

Haha. Here I thought that once I finished my manuscript I’d magically have more time to write at Get Rich Slowly. That’ll happen soon, but I’m not there yet. Turns out editing is just as much work as writing — it’s just a different kind of work.

I have to edit all 14 chapters of Your Money: The Missing Manual by next Monday, which is a huge task, especially when you consider my goal is to polish everything and create a tie it all together. As a result, I’ll be sparse around here. In fact, I may have to publish a couple of guest posts this week and next.

In the meantime, it’s been a while since I shared a roundup of interesting links. I’ve stumbled across a few lately that I’d like to share.

First up, here’s the story of Katharine Hibbert, a woman who lives in London without money. I’ve shared a couple of similar stories in the past, but Hibbert’s is different. Whereas other “no money” types live lifestyles that don’t appeal to me (living in a cave, drinking urine, and so on), she’s able to make a go of it without anything too radical. (Her use of a cell phone makes me scratch my head, though. How is that possible without money?)

Over at Card Ratings, Curtis Arnold has posted his list of the best credit cards of 2009. As I mentioned last week, I’ve actually considered going back to a no-credit kind of life. But I recognize that some folks love finding new cards. If you’re one of them, check out this list.

Ramit at I Will Teach You to Be Rich has been writing a lot lately about how to earn more money. I’ve said it before and I’ll say it again: The best way to turbo-charge your financial success is by earning extra income. I don’t cover this topic as much as I should around here, especially considering how important it is. One of Ramit’s recent posts describes how to turn your skills into services people will pay for. Great stuff.

Matt at Steadfast Finances wrote a great article about visualizing how your stuff owns you. This is basically another approach to the “real hourly wage” from Your Money or Your Life, but the visual aspect sets it apart. I love this.

Finally, FMF from Free Money Finance asked me to point out he’s started his “March Madness” blog tournament. This is like the NCAA basketball tournament, but pits the best blog posts from the past year against each other. I’m honored to have a few in the running. If you have the time and inclination, go vote for your favorites!

—
Related Articles at Get Rich Slowly:

• Return of the Daily Links
• Daily Links: A Fool and His Money Edition
• Daily Links: Alltop Edition
• Daily Links: Compound Interest, Web Income, and Happiness
• Daily Roundup: Bringing Home the Bacon Edition

Let’s face it, whoever said technology was going to make our life any easier was lying! From where I stand, I see we are busier than ever trying to keep up-to-date with our email inbox, our twitter pages, our Facebook accounts, our offline friends and least not forget our family.

Quite frankly, our minds are cluttered beyond recognition. It comes as no surprise that so many people snap at the drop of a coin. This constant time demand coupled with the immediacy of communication these days, makes us feel like shutting down means not caring, not participating, and well, getting left out.

As a modern human race we are drowning alive in the clutter of our minds.If you don’t believe me take a look at the constant bombardment of advertising you are exposed to every single day:

• Perhaps you watch TV
• Read Magazines
• Read newspapers
• Read industry zines
• Read blogs
• Read websites
• … shall I go on?

We are basically slaves to our own technological advancement and it doesn’t look any rosier in the future. In fact, the number of data sources available to you today will only continue to grow (and at an increasing rate)!

If you want to break out from the cycle of mental stress you need to find ways to declutter your mind and filter what you allow in. Every single day we are exposed to millions of tiny bytes of information. Fact is, without a filter you’re forcing your brain to absorb, understand, digest, and store it. I mean really, that’s a tall order - even for the human brain.

Decluttering your mind starts with your intent - you need to WANT to make changes first before you can address the imbalance. Here is how you do this:

1. Stop putting things off
   By putting things off you only make matters worse and add to the stress levels you probably already experience. I have found that by addressing the biggest task of my working day first I generally get a lot more done. It adds to the fantastic feeling at the end of the day when you can honestly say to yourself that you achieved all goals.
2. Let go
   What is wrong with letting things go? Nothing! Declutter your house, your life and your mind. It is the fastest way to living worry-free.
3. Stop trying to meddle at all the parties
   Do you really have to be a member of all the social networks considered hip today? I dare you not. Try to reduce the number of platforms, memberships, networks you join and enjoy more mental freedom as a result. A great by-product of doing this is that your contributions will be a lot more valuable because they will come from your heart - and not your need to party across town.
4. Decide now
   How many undecided decisions are lurking in the back of your mind right now? I’ve always been a person who is spontaneous which helps me to make a decision on the snap of a finger. Even if your decision turns out to be wrong in the near future at least you’ve acted and cleared your mind. Plus you just made another valuable experience for life.
5. Limit common distractions
   Most of us are exposed to a number of daily distractions that stop us from doing what we NEED to do. Close your email inbox, log out of Skype, switch off your mobile phone and just concentrate on the task you do right now. You will be surprised how much more you get done - without the stress - by limiting distractions.
6. Simplify your life
   Stop multitasking and focus on the one job at the time - every single time. Multitasking is evil because we end up doing nothing while trying to do too much.
7. Breath
   How often do you stop breathing when you are in a stressful situation? Learn to breathe deeply into your stomach. Do yoga, mediate, or simply take some time out with a good book or by doing nothing at all. You will be rejuvenated and ready to tackle the most complex task afterwards.
8. Forgive and forget
   Do you harbor any malicious thoughts towards a person from your past? Most of us do, me included. There were people in my life I couldn’t forgive for what they did to me. After much soul searching I decided to let it go and lo and behold, I felt a wonderful sense of peace. The previous stress and anger was replaced by detachment and curious observation.

Decluttering your mind is easy with the right conviction and intent. By doing so you will regain your inner peace, work better and experience more satisfying relationships.

All of the above tips are ideal to get started while easy enough for just about any one. Feel free to add to the above by sharing what works for you. I look forward to hearing from you.

What Congress giveth, credit card companies are poised to take away.

In six weeks, the final major provisions of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act will take effect.  The law prohibits many egregious tactics used by card issuers, such as retroactively raising interest rates on consumers' balances.  But issuers have reacted to the sweeping new consumer protection law by quickly inventing new egregious tactics, including raising rates and lowering credit limits on half of all U.S. cardholders. 

And that may just be the beginning. Bill Hardekopf of Lowcards.com expects a series of new “gotchas” from card issuers in the year ahead, as they struggle to recover revenue lost to the CARD Act or the economic downturn.  Here are six new booby traps consumers should watch for this year.

1) More cards with annual fees

Today, only about 20 percent of credit cards come with annual fees, Hardekopf said, and consumers with good credit can easily avoid them. That will be less true this coming year. Already, Bank of America is surprising some existing customers by adding fees ranging from $29 to $99.  

Annual fees need not be so obvious, however.  Citibank is demanding $2,400 minimum annual spending from some customers — otherwise, they face a $35 fee.

It's important to carefully watch your bill to see if an annual fee has been added, Hardekopf warns. Otherwise, you might pay the fee unknowingly.

Despite the expected onslaught of annual fees, Hardekopf says consumers should still be able to find annual fee-free cards. 

"I believe the credit card industry is competitive enough to where there will be an issuer or issuers who will offer free cards," he said.

Consumers who are tagged with a new fee should seriously consider dumping the card and getting a new one. That should be done with care, however. Never close the old card without receiving a new one first, because closing the card will hurt your credit score and could prevent you from getting a new one.  Even closing it later will hurt your score, but probably not enough to exceed an unwanted $99 annual fee.

2) Fixed-rate cards changed to variable rates

It will be harder for banks to raise consumers' credit card rates once Feb. 22 rolls around. There is one loophole: Variable rates will still float up and down in line with the Prime Rate. Since bank rates have nowhere to go but up, variable rate card rates will definitely be going up.  Watch the mail for notice that your fixed-rate card is no longer fixed. If you don't like the change, consider switching to a new card – but follow the advice above.

3) Increases in interest rates

Many existing cardholders have already endured rate hikes; now, it's time for new cardholders to get hit. The CARD Act has no limits on the rates that consumers can be charged when applying for new credit cards.  Unable to raise rates on current customers, banks will target new customers with higher prices.  Why is this important? Consumers who feel jilted will be shopping around, and may not find options as many attractive alternatives as in the past.

4) Increases in existing fees

The CARD Act eliminated some fees, such as over-limit fees, but it did nothing to cap other fees. The best example so far: balance transfers between cards have typically been 3 percent for some time.  Last year, Bank of America hiked the fee to 4 percent and recently JP Morgan Chase raised its to 5 percent. Cash advance fees will likely follow suit, and late fees probably won't be far behind.

5) New fees

This is the most alarming area of all.

"Overall, I think fees is the big word for 2010," Hardekopf said. "There are people dreaming up fees right now that you and I have never heard of."

Card companies are taking tips from other industries in their fee-invention schemes, he said.  Some issuers are charging $1 a month for paper bills (imitating the cell phone industry). Fifth Third Bancorp recently added a $19 inactivity fee for customers who don't use their cards during a year. (Stockbrokers were the trail blazers on that one.

"Since fees represent such a cash cow for issuers, expect aggressive increases in existing fees as well as some brand new fees on your credit cards," he said.

6) Futzing with rewards

Decreasing the value of rewards points might not sound as harsh as a penalty fee, but it is.  Card issuers have myriad ways they can toy with rewards values, and many have begun doing so in earnest. Many miles cards now require more points for travel; some have added "tiers" that make travel more expensive, effectively devaluing the points. Other cuts are more obvious: Cash reward cards that lower their percentage rebate, for example. One of Hardekopf's personal cards now rebates only 1.25 percent of all purchases, down from 1.5 percent.

"I'm an avid user of credit cards. I put everything on my card just so we can get the cash back," he said. "This decrease in rewards is costing us money and I'm irritated."

Better or worse?

While the CARD Act contains many positive consumer protections, it's open for debate whether consumers will be better off after it takes effect than they were before, given the reaction by banks.  Hardekopf thinks there's not much room for debate.

"I think consumers are worse off than they were before," he said.  "Taken with what the issuers have done in response to the CARD ACT, I do think it has hurt more people than it helped."

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