Be Careful Of Credit Card Games and Tricks That Steal Your Cash

Do you know the games credit cards love to play with you? You do realize that credit card companies are out to make as much money off you as they can, right? If you don't know how they try to go about this, you can be in for some unhappy surprises on your next statement.

Today, I'm going to touch on two of these tricks that may have you paying more out of your pocket than you thought you would.

One thing credit card companies like to do is to play with your due dates. You get a new credit card, the first statement comes, and you see the due date is the 29th of the month. Great! You have almost the whole month to pay the bill.

But be careful! A couple months later, if you're paying attention, you notice that the due date is now the 21st. What happened here? They've changed the rules on you. If you weren't paying attention (which, by the way, credit card companies know most people don't), you send your credit card payment out on time (you thought), but it's now late.

Now they get to slap you with a nice late charge of $29 or $40. In my six years as a financial planner, I saw clients that were even charged as high as $50 or more for being late.

Did you get a nice 6% teaser rate when you signed up for that credit card? Well, now that you were late, they'll most likely jack your rate up to the normal 17%-25% range. Just like that, you're now paying them more interest every month, also.

Thanks a lot, right?

Sounds unfair, but it's all legal.

A second little trick credit card companies like to pull is what's called "seasoning" their mail. They receive your payment on time, but conveniently let it sit in their mailroom for a couple days. By the time one of those friendly representatives opens your bill, it's now late.

They just smile as they add that late fee to your next credit card bill.

Make sure you send your credit card payments in with plenty of time so you never get hit with this shameful tactic.

There's two credit card "scams" (as I like to call them). Be on the look-out for more in one of my future posts.

Credit cards. Gotta love 'em!

Published by Matt Z. on May 19, 2006 01:46 AM