Fair Contracts

Be wary of “debt consolidation” and “debt management plans” that require up-front payment, pay agents on commission, or charge exorbitant fees. These may be scams that will only get you further into debt.

Always try to pay your credit card bill early to avoid late charges. That means at least a week before you think the payment is due. Credit card companies use numerous tricks, like changing your due date, to force a late payment, which allows them to charge you a late fee and increase your interest…

Always pay more than the minimum payment on your card; credit card companies keep the minimum payments low so that it takes you longer to pay and nets them more interest payments. Pay as much as you can–you should get into the habit of paying off your total balance each month.

Read the fine print on credit card teaser rates–don’t fall for a low rate that balloons to over 20% after an initial term of days or months.

Price isn’t the only important term in a purchase agreement. Make sure you understand all aspects of the agreement, including important elements such as cancellation processes and arbitration clauses.

For some larger undertakings, such as purchasing a home or starting a business, it may be wise to enlist the help of someone who can explain confusing terms to you, such as a lawyer. Though lawyers may charge a fee for this type of work, it can often save you more money down the line.

Don’t assume that you have no way out of a bad situation; always research your options if you feel you’ve been cheated. A good place to start is your state’s Attorney General office.

Don’t be fooled by merchants who offer free gifts or other favors. These gifts may be there only to entice you into agreeing to otherwise unfavorable agreements. In any case, the cost of these “gifts” is built into the final price you pay anyway!

Never sign a contract if you do not understand its terms! Many merchants intentionally confuse consumers with industry terms and bizarre “legalese.” Don’t fall into the trap of assuming that a merchant has honestly and adequately explained these terms to you.

Having merchants or their representatives explain the terms of an agreement to you is not a good alternative to reading and researching on your own. Their job is to convince you, not inform you. Whenever possible, gather the advice of impartial experts or study up on the terms you don’t understand.