TULSA, Okla. — Credit card issuers send offers promising thousands of bonus points, zero percent interest rates and pre-approval notices to entice consumers to sign up for new cards.
Before you take the bait, it's important to read the fine print.
Those offers may come with significant hurdles that make them less appealing than they first appear.
"Credit card issuers have plenty of tricks to get you interested in a credit card, and sometimes those offers are spectacular if they are indeed a right offer for you, but oftentimes, you just don't know if you don't read the terms," said Ana Staples, credit card expert.
The terms — sometimes called the "mice type" because they're printed in teeny-tiny type — can put lots of requirements in the way of actually getting the bonuses promised in the bold type, especially if the card requires you to spend a certain amount of money to get that bonus.
"For example, $3,000 in 3 months. So then you have to think this is $1,000 per month. Is this how much you usually spend or close to it on a credit card? If so, then that's great. Maybe that's a great offer for you. If not, then you might actually overspend and get yourself in credit card debt just to take advantage of the offer, and that's not great news for you," Staples said.
She stresses the importance of reading the fine print on zero-percent cards.
"You just really need to remember that that 0% APR doesn't last forever. There's always an expiration date. It's usually between 12 and 21 months. After that, the interest starts to accrue again. So, this is a really great tool to use if you have a large purchase and you have a plan to pay it off within the promotional period, because again, if you don't do that, you are risking to get into credit card debt," Staples said.
One last word of caution — typically card issuers don't alert you when your zero percent period is about to expire and they start charging interest on your balance.
"They do make money from interest, so it is in their interest to get you to pay interest," Staples said.
This often comes as a surprise if you've gotten used to carrying a balance without accruing interest charges.
Staples advises that credit cards can be excellent tools for earning rewards and building credit when used responsibly.
"If you know how to use it well, it's gonna serve you amazingly. If you don't, you might actually ruin your credit history just from the get-go and start your financial journey with credit card debt, which is not great news for your wallet," Staples said.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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