Credit card issuers are doubling minimum payments from 2% to 4%, raising interest rates, cutting limits and canceling cards for any reason, no reason, too much activity, too little activity and/or no activity at all.

Interest rates of 10.9% are increasing to 19.99% and up to 29.99%. Late fees are being imposed with any delay in your payment being posted. Over limit fees are further increasing your outstanding debt. The combination of fees can add hundreds of dollars to your balance and there is nothing you can do about it after the fact.

Never has there been a better time to swear off credit cards and pay down your debt than right now. Go ahead, pull them out and cut them into tiny plastic pieces. It might hurt a little but it’s the path to recovery.

Good Credit Isn’t Enough

No one is immune from being cancelled or having their terms changed. Card holders with impeccable credit who have never made a late payment and are not anywhere near their personal credit limit are having their rates doubled and in some cases tripled. Millions have had their accounts closed for lack of use after being good customers for years. Explaining and complaining seldom helps. Closed is closed according to the banks in most cases.

Here’s a story from my own life. I’ve been a customer of First National Bank of Omaha for 40 years with an almost perfect FICO score, never a late payment and no rollover balance. But they canceled my Visa card due to inactivity. The customer service representative I called was kind and patient yet insisted she could do nothing about it. Not one to give up a lifetime of credit history, I wrote to the bank president. His assistant called me a week later and offered to let me reapply and see if I qualified for a new card. Still miffed and not really needing the card, I agreed ONLY if they would reinstate my “member since” date to 1969. They did.

Help On The Way (But Self-Reliance Is Even Better)

Help is coming in July 2010 when sweeping changes to credit card rules take effect. Welcome relief from federal regulators and not a moment too soon for those drowning in credit card debt and vulnerable to these exorbitant fees. Credit card issuers will need to redesign, rebuild and re-price their offerings based on the largest crackdown on credit card companies in 30 years.

But that’s then and this is now. Whatever rules are in place, you need to understand how your credit card issuer assesses charges and penalties. This information can literally can save you hundreds of dollars. Watch the triggers closely to avoid getting trapped paying 29.99% on your outstanding balance. Transfer the balance to a lower cost card if necessary. Paying on time and doubling your payment will also help put you back on the financial straight and narrow.

Do you open and read your monthly utility bills and credit card bills line by line to make sure you’re not being over charged? You need to. All sorts of fees and heinous charges will appear therein, if you don’t watch your bills like a hawk. Sad, but true.

I say this from experience, as I just recently uncovered a $15/month mystery fee on our AT&T Wireless bill. When I called AT&T customer service to find out what this recurring monthly charge was for, the Rep instantly made the charges go bye-bye. She said it looked like a scam that’s activated simply by opening a text. So be very careful not to open a text message if you don’t know who it’s from—doing so unfortunately exposes one to digital pick pockets.

Also, I might have missed that bogus line item if my account was on auto-pay. I know auto-pay makes quick work of a tedious chore, but it also makes it tempting to forget about your bill and the important details therein. However you pay your bills, it pays to read first and pay second.

Haggle — It’s For Your Own Good

Okay, you’ve properly inspected your bills and found the assessments to be legitimate, but not altogether pleasing. Take your local cable company, for instance. They’re making major bucks off of your media habits, I am right? We’re going to do something about it in our household. We’re going to move from Comcast to Clear, the new WiMax service available in our area.

But for the sake of argument, let’s say we liked Comcast and wanted to keep the services we have. Fine. But the monthly packages need to be reworked at once. A simple phone call to Comcast ought to be enough, for they don’t want to lose customers. Customers are expensive to acquire and thus crucial to hang on to.

Rich Like You suggests calling Comcast to cancel your services. When they ask why, tell them you’re taking AT&T up on their $20/month introductory offer for Internet (whether it’s available in your area or not).

It was painless, the whole process took <5 minutes. If you have not been on a promotional rate, then just tell them that with the economy that you need to reduce your monthly expenses and that internet is a luxury item for you. Tell them that some of their competitors are offering rates significantly lower, and some even at $20. They will give you a speech about the speeds and other nonsense, just tell them that the speeds are not important to you, and that you hardly use the Internet.

I doubt you will have any problems, but if you do can not get them to budge, ask them to set the cancellation out a few days and then call back and cancel the cancellation.

Bottom line, services of all kinds are negotiable. With cash in short supply today that’s only going to become more and more true. Look to barter where you can, and look to haggle where you can. If you’re successful at it, you’ll have more money to spend on the things that matter most to you.