When you think of yourself and your finances, you might feel like you're all alone, floundering. Take heart -- you're not alone. Your friends at the Fool are here to help, and we're not alone, either. Even the Federal Reserve Board is looking out for consumers. On its "Choosing a Credit Card" page, it urges us to understand the features of credit cards, compare credit card features and costs, know our rights when using our credit cards, and file complaints if we have problems with our credit cards.
It goes on to offer details on all of these, such as the following questions you should find answers to, regarding any card you're considering:
- How will you use your credit card? [This will help you zero in on low-rate cards over high-rebate cards, for example.]
- What are the annual percentage rates (APRs)?
- How long is the grace period?
- How is the finance charge calculated?
- What are the fees?
- What are the cash advance features?
- How much is the credit limit?
- What kind of card is it?
- Does the card offer incentives and other features?
When it comes to fees, here are some of the fees you might run across:
- Annual fee (sometimes billed monthly)
- Cash advance fee
- Balance-transfer fee
- Late-payment fee
- Over-the-credit-limit fee
- Credit-limit-increase fee
- Set-up fee
- Return-item fee [for bounced checks, essentially]
Here are some more tidbits:
"If your credit card is lost or stolen -- and then is used by someone without your permission -- you do not have to pay more than $50 of those charges. This protection is provided by the federal Truth in Lending Act. You do not need to buy 'credit card insurance' to cover amounts over $50."
"The federal Fair Credit Billing Act allows you to withhold payment on any damaged or poor-quality goods or services purchased with a credit card -- even if you have accepted the goods or services -- as long as you have made an attempt to solve the problem with the merchant. The sale must have been for more than $50 and must have taken place in your home state or within 100 miles of your home address. You should notify the credit card company in writing and explain why you are withholding your payment. You may withhold the payment while the credit card company investigates your claim. If you pay the charges for the goods on your credit card bill before the dispute is resolved, you will lose your right to make a claim."
Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article.
