credit cards

How credit card mishaps are like dating

Love life, meet money
Love life, meet money

Sometimes finding your soul mate can feel like you're searching for a needle in a haystack. You can wade through dozens of online profiles and hear about potential love matches from family and friends, but you still can't seem to find your perfect match.

Despite the dating disasters you've endured, there's a lot you can learn about the way you manage your finances from your quest to find "the one."

Searching through myriad profiles online can feel a lot like sorting through all those credit card offers you get -- and you need to find the one that's best for you while fending off the ones that could be lying about what they're really about.

Here's a look at the similarities between dating and managing your finances, and what you can do to make sure you develop a healthy financial relationship -- even if you're still searching for the love of your life.

Gimmicks aren't always best
Gimmicks aren't always best

Potential mates who you see online often resort to gimmicks, and they hope to garner some attention. Let's face it: They pull out all the stops in the hopes of winning you over. But soon a would-be suitor's unsavory characteristics, habits or traits shine through, and you're left wondering what you ever saw in this love match.

The same goes for credit cards and other financial offers that throw out flashy gimmicks aimed at grabbing your attention hoping you won't spot their faults buried in their fine print and lingo.

Miss those gimmicks until you're in a "relationship" with a credit card, and you could end up in debt or paying high interest rates, says Beverly Blair Harzog, a consumer credit advocate.

"If it sounds too good to be true, it is," says Kelley Long, CPA, member of the American Institute of Certified Public Accountant's National Financial Literacy Commission.

Common gimmicks include balance transfer checks with zero percent introductory APRs and varying expiration dates, says Harzog.

Rewards credit cards can also be a trick. "The more you spend on these, the more points or rewards you accumulate ... but you could wind up spending just to get a free airline ticket or dinner out and rewarding yourself right into deep debt," says Long.

Blind dates
Blind dates

Ever been on a blind date when 10 minutes in you're waiting for that fake emergency text giving you a way out? Even though entering into a relationship blind means you could meet "the one," it also means you could meet a dud. Or worse, a weirdo!

Gregory B. Meyer, community relations manager of Meriwest Credit Union in San Jose, Calif., says the same thing can happen with credit cards.

"The rule here is: No blind dates. Get to know your credit card before you apply for it, just like you would get to know your dates before committing to drinks or dinner."

Take the time to learn what problems and benefits a new card will bring to your life. Read the small print included with a credit card application, and learn about the annual fees and other important information about the card. Don't just look at the bright, colorful numbers on the preapproved offer and accept it at face value.

Breaking up doesn't have to be hard to do
Breaking up doesn't have to be hard to do

If it's just not working out, and you're not into someone you're dating, chances are you'll dump Mr. or Mrs. Wrong. There's no time to waste on someone you're just not that into.

The same goes if you're in a bad financial relationship. You don't have time to waste with a credit card or bank that sends signals saying: "I'm just not that in to you." And if it feels like you're being taken advantage of and there is a better offer out there for you, then take it, says Long.

Some signs it's time for a financial breakup include increased bank fees on things such as debit card usage, teller deposits or general monthly account fees. Having to pay a big annual fee for a rewards card is another sign it could be time to move on, says Long.

Sending a credit card packing may be tough if the two of you have baggage to sort out in the form of an outstanding balance. Before you try to break up with your credit card, you have to pay off the balance in full, says Harzog.

Be prepared. Your credit card might try to "get back together with you." The card will send you letters asking you to come back and offers of bonus rates and special deals that will make you blush. "I'm better. I've changed!" the card will say. You might want to get back with that card, but the question is: Did the card really change?

You may have to kiss a few frogs
You may have to kiss a few frogs

You may have to go on a lot of dates and kiss a lot of frogs to find your Prince (or Princess) Charming. Not everyone is perfect and we all make mistakes, which means there may be a few financial frogs along the way, too.

One of those frogs could be a secured card that doesn't report your payment history and balance to the three major credit reporting bureaus. "Many secured cards do report this information, but you should always confirm that before opening the card," says Harzog. "The whole point of a secured card is building up your credit score."

And don't think your only credit card option is going with a frog of a credit card that carries an exorbitant interest rate. Harzog says those aren't princes in disguise -- they're actually predatory lenders. "Some charge rates from 36 percent APR as high as 49.9 percent APR. Do some research, and you could find a better alternative."

Focus on the good things that are happening in your financial world. "The power of attraction works for positive and negative things. If you focus too much on the financial speed bumps -- or frogs -- you'll just find more of them. Focus on good things and the positive things you are dreaming about so they find their way to you," says Long.

 

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Product Rate Change Last week
Balance Transfer Cards 15.76% --0.00 15.76%
Cash Back Cards 16.44% --0.00 16.44%
Low Interest Cards 11.04% --0.00 11.04%
 
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