Quicktips: How To Be A Smart Credit Card Consumer

Read the fine print. Before you sign on the dotted line, make sure you know what you’re getting. Read the introductory offer and any follow-up correspondence to understand what terms and conditions you’re accepting. Is the annual percentage rate (APR) fixed or variable? How often can the variable rate be adjusted? What’s the grace period? How are finance charges computed? What are the fees, including those for late or missed payments and exceeding your credit limit?

Watch out for climbing APRs. The APR measures what it costs you yearly to use a credit card and revolve a balance. Low-introductory APRs may entice you to sign up for a new credit card, but that teaser APR may jump steeply after a few months. Indeed, you may not end up saving the money you hoped - in fact, it might end up costing you more.

Choose the best card for your needs. If you pay your bill in full each month by the due date, look for a credit card with a low annual fee and a grace period. The grace period is the length of time you have until interest gets charged, typically 20 to 30 days for new purchases. If the card doesn’t offer a grace period, or if you carry over a monthly balance or take a cash advance, you’re usually charged interest immediately.

If you aren't able to pay off your bill and you revolve a balance, shop for a card with a lower APR — this can make a big difference in your yearly costs.

Make your credit union your first stop. Surveys show that credit unions generally offer credit cards with lower interest rates and fees than other financial institutions.

In fact, a recent survey by the Credit Union National Association and the Consumer Federation of America, a nonprofit association of consumer groups, found that credit union credit card interest rates average five percentage points lower than bank credit cards.

Evaluate reward programs carefully. Whether you’re accumulating points for such things as air miles, long distance minutes, or a car purchase, figure out what you’re getting compared to what you’re paying for the credit card. The realities: Some reward cards come with steep annual fees, others charge high interest rates. Some reward you more if you carry over a balance from month to month, which can cost you in interest charges. And some companies change their rules midstream, so you have to pay close attention to the credit card notices you get in the mail. All told, usually the best deal of all is to pay off your credit card bills in full each month and save on interest charges.

Know your rights. If you’re dissatisfied with a credit card purchase of more than $50, and the purchase was made in your home state or within 100 miles of your mailing address, federal law offers you some recourse. If you haven’t paid your bill in full, and have made a good faith effort to resolve the complaint directly with the merchant, you can refuse to pay that portion of the bill until your complaint is resolved. If you have a complaint, contact the credit card issuing company for information about how to get assistance.