Credit Cards’ Hidden Costs by Kathleen Day
Credit card companies don’t clearly disclose penalties, variable interest rates and other fees, leaving consumers confused about the true cost of using plastic to pay for everyday transactions.
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The report by the Government Accountability Office found many consumers do not understand that if a borrower is late on one payment, companies will not only impose a late fee, which can reach nearly $40, almost triple that of a decade ago, but also significantly raise the interest rate on past and future charges, possibly to as high as 30 percent.
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The report by the Government Accountability Office found many consumers do not understand that if a borrower is late on one payment, companies will not only impose a late fee, which can reach nearly $40, almost triple that of a decade ago, but also significantly raise the interest rate on past and future charges, possibly to as high as 30 percent.
Credit cards can be a convenient tool but if you do not pay the balance off every month on time that is a very bad sign for your financial health. And leaves you open to onerous fees from credit card issuers. If you do pay off the whole balance every month (as you should under almost all circumstances) you should have a credit card than pays you a rebate (1% of your spending is common) and has no annual fee.
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