Plastic Traps
Credit card fine print is getting even finer both from a cardholder's perspective (more difficult to read and understand) and from a card issuer's perspective (likely to contain provisions that generate additional revenue). According to an article in the Washington Post on 10/15, a recent government report found cardholder agreements difficult to read and riddled with provisions stacked against cardholders. Such provisions include the issuers' ability to raise interest rates if cardholders are late in paying other bills, charging different rates for different types of transactions, and charging fees for transferring your balance elsewhere. The report also noted that late payment penalties have risen to an average of nearly $34--up from about $13 in 1995.
Matt's View
It's no wonder that penalty fees now account for one-third of the credit card industry's revenue--double the amount from 10 years ago. Our best defense is to pay online to help avoid late payments and pay the balance in full every month to avoid interest charges. However, according to a 10/15 Time magazine article, card issuers are thinking of instituting a fee for people who don't carry a balance. Just what we need: a penalty for being wise with our money!
This article filed in: Credit/Debit Cards
Managing Money by The Book
- "To keep me from becoming conceited because of these surpassingly great revelations, there was given me a thorn in my flesh, a messenger of Satan, to torment me. Three times I pleaded with the Lord to take it away from me. But he said to me, 'My grace is sufficient for you, for my power is made perfect in weakness.'" - 2 Corinthians 12:7-9
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