The hidden dangers of credit cards

Have you ever read the full terms and conditions of your credit card agreement? If no, do it now!

08:05 09 October 2013

Banks and financial institutions do not warn their customers about the hidden fees and commissions, so it is in fact very easy to fall into a deep trap. Most people either don't have the time to read the small prints on their credit card terms and conditions, or don't actually understand what they refer to.

However, information is crucial, and you can save a lot of money and avoid credit loss by knowing exactly what the costs are. Here are some things that you should look out for when using a credit card:

• 0% deals can be very tempting, but you have to make sure that your credit card doesn't have any hidden specifications that would limit the offer. Sometimes, the offer is only applicable to people who have a good credit rating, so you may be charged extra if you don't;

 

• Some interest-free products offered with your credit card actually have a limited time period when the offer applies – for example, the first nine months. So you might in fact end up paying a huge interest if you use it after the offer has lapsed;

 

• Some credit cards may have ambiguous terms and conditions written in vague language. It is better to clarify these things before you start using your credit card. It does not hurt to get it clarified after all, if you do not understand certain financial terms very well. Make it a point that you always enquire about specific parts of the terms and conditions that are not clear to you, without feeling ashamed or timid to do so;

Credit cards are very useful to save both time and money, but only if you know how to use them and steer clear of financial traps. If there is anything suspicious with the terms and conditions, address a specialist as soon as you can.