The latest round of new rules for credit cards takes effect August 22. Those rules were made to protect consumers, so each can be taken as an indicator that Credit Card Debt Management is an issue in that area. With a little education, credit management becomes fairly simple and is a very important skill to have. Here are the four changes and what they tell you:

• Penalty Fees: The new law sets a lower limit of $25 as the maximum you can be charged for a late payment. Until now the max was $39, regardless of how low your minimum payment was. For example, you could be charged a $39 late fee for being a day late with your $10 payment. The other part of the new rule is that the late payment penalty fee cannot be more than your minimum payment, i.e. You can only be charged a $10 late fee for being late with a $10 payment. The red flag here points to Late Payments. Clearly, the penalty is stiff and can set you back as much as your minimum payment, so you may be setting yourself up to owe the same amount forever, regardless of making payments if you pay late and incur a fee.

• Additional Fees: Credit cards can no longer charge you a fee for not using your card, which is a very positive change. Chances are, if you were using your card to avoid an inactivity fee, you were buying something that did not get paid off, so it then incurred interest charges each month. The credit card company is also limited to assessing one fee per transgression.

• Rate Increase Explanation: Credit card issuers now have to explain the reason why they raise your Annual Percentage Rate (APR), it that happens. This tells you that they can raise your rate. If you’ve dealt with financial companies before, then it’s not going to be much of a surprise that they will raise their rates. They want to make money. You want to save money. Try to find a bank or other finance company that guarantees rates or at least the rate of interest increase. There are credit management articles online that can help you understand this better.

• Rate Increase Re-evaluation: Credit card companies that raise your rate also have to reevaluate your rate every six months and must reduce the rate within 45 days if appropriate. This lets you know that credit score management is important too since the reason can be a falling credit score or missed payments on other cards as well as the more obvious missed or late payments on the card in question. Your credit requires management just as your money does. Make sure you don’t overextend on any loans or credit cards. The inability to pay on one account can cost you money on other, completely unrelated accounts.

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