How to Lower Phone and Credit Card Bills

They are the new millennium’s answer to aluminum siding salesmen. Just as ubiquitous and every bit as aggressive, they interrupt our dinner hours with phone calls and see to it that our mailboxes are stuffed to overflowing with “pre-approval” notices.

I’m talking, of course, about marketers of credit cards and long-distance telephone service. But as much as we’d like to tune them out, we as work at home business people and consumers need what they offer.There are ways to filter out the white noise of these marketing pitches, using government agencies and other resources to make informed decisions. In a moment, I’ll tell you about those sources.

First, however, consider this little fact: Annual credit-card purchases now total well in excess of $1 trillion. It’s little wonder that we get inundated with offers of new cards, but not all cards are the same. Some really are better than others — or at least more appropriate for our individual circumstances and needs.

The choice of a credit card or the decision to buy a certain phone service can have a direct impact on your personal bottom line. And for owners of small and mid-sized businesses, the selection can be doubly important.

How do you make the smartest buy?

In 1998, according to a Small home business Administration study, nearly half of small-business startups with 10 or fewer employees were financed with plastic. The importance of finding the right telephone service is obvious: It’s the communications lifeline of virtually every business.

So how, given the welter of competing offers, do you make the smartest buy? And then how do you ensure that it continues to be the smartest?

Start by separating the process into three steps:

Learn the vocabulary. While different vendors promise different things, they generally do so using the same words. You can’t make a valid comparison unless you understand the terminology. So learn it, using several readily available resources.

Shop around. It would be possible to collect every solicitation that comes your way and then sit down and try to make sense of the stack of paper, but it’s not realistic. Nor is it necessary; a variety of Internet sites make comparison shopping easy.

Know where and how to appeal for relief. If a telecommunications provider or card issuer isn’t making good on the deal you accepted, you do have forms of recourse. You just need to know where and how to appeal.

Any citizen with a computer and modem now has at his fingertips the vast wealth of information collected by the federal government. Plenty of it has to do with credit cards and telephone service.

A good place to start is the Federal Trade Commission (FTC) Web site, where you’ll find a Consumer Protection page containing references to information on a variety of consumer-related topics. Credit and telephone services are among the listings.

The topic pages are further delineated. The credit page, for example, contains a link to “Choosing and Using Credit Cards,” which attempts to explain the different terms contained in offers and their potential impact on card users.

Similarly, the telephone services page offers “Long Distance Deals” and “Making Sense of Long Distance Advertising.” Again, the intent is to introduce prospective buyers to the arcana of the marketplace and point out the potential snares to be found there.

Another good source of information on credit card offers is The Truth About Credit Project of the state public interest research groups (PIRGS). The site identifies 10 credit-card traps, defines commonly used terms and explains how to decipher offers.

Meanwhile, phone service shoppers should check out the Consumer Information Directory on the Federal Communications Commission (FCC) Web site. Included is series of references to information about telephone bills and charges.

Anyone whose interest in telecommunications extends from the microeconomics of his own situation to the macroeconomics of the industry will want to check out an assessment of the 1996 Telecommunications Act on the Consumers Union site. The advocacy group argues that the law, which deregulated the industry, has delivered less than promised and has been bad for consumers.

Think you’re ready to decide?

Armed with a little knowledge about the credit-card or long-distance markets, you’re ready to make a buying decision.

One way would be to gather up all the solicitations you’ve received, and then attempt to make some sense out of the stack of paper. That’s not very feasible, of course; nor is it necessary.

The Web informs; it also helps you buy. Check out these sites:

For the best consumer credit card deals, try CNBC Money on MSN, Bankrate.com and Cardweb.com. They allow consumers to select from hundreds of cards offered by large and small institutions and find the one that best suits them. (For business cards, Microsoft bCentral and Bank One have teamed up to create a special low-rate offer.)

There also are plenty of sites that provide comparative breakdowns of long-distance service. With LowerMyBills.com, users enter their area codes and exchanges and then receive detailed breakdown of the different plans available to them. Or try priceline.com with its reverse auction, where buyers indicate what they’re willing to pay and then wait to see if any vendors bite.

These are just a few of literally hundreds of relevant sites. A simple search will turn up many more.

OK, so you do your homework, make a buying decision and then are unhappy with the result. Then what?

Back to square one, which is to say the federal government. In its brief on choosing a credit card, the FTC provides contact information for the agencies that have jurisdiction over the different kinds of financial institutions that issue cards.

If the problem is with a long distance provider, a complaint should be filed with the FCC.