The Boston Globe

I confess. I got lured by one of those introductory
low-interest credit card offers that millions of
Americans get every month, and what I missed in the
fine print cost me.

Now, I'm the type of person who balances her checkbook
to the penny and pays off credit card bills every
month. And I don't fall for too-good-to-be-true
financial scams.

But an estimated 3 billion credit card mail
solicitations are sent out every year, according to an
analysis by the Consumer Federation of America, and
one of them happened to land in my mailbox when I had
a short-term cash crunch.

Nationally, about three-quarters of credit cards are
sold through mail solicitations, according to the
Washington-based coalition of more than 250 consumer
groups, and the number of such solicitations has
approximately doubled between 1993 and 2000.

Over that same period, the amount of credit card debt
and lines of unused credit nearly quadrupled, from
$777 billion to about $3 trillion, according to the
federation. And another set of figures, released two
weeks ago by the American Bankers Association,
suggests some Americans are beginning to drown in all
that debt, not to mention in all that credit card junk

The percentage of credit card accounts past due
reached 3.93 percent in the second quarter of this
year, a 30 percent jump over the 2.99 percent rate
during the same quarter a year ago, according to the

I'm neither past due nor in danger of drowning in
debt, but I nonetheless got lured by this credit card
offer: A 1.7 percent introductory annual rate on
balance transfers, and the promise of no transaction
fees and an up to 2 percent cash-back bonus.

So I transferred a balance over to the new card,
thinking I would manage my cash flow aggressively
through the short-term crunch. I also charged some new
purchases, thinking I might as well start earning the
up to 2 percent cash-back bonus.

When my first bill came in, I paid the amount of the
new purchases in full, and figured I would carry the
transfer balance for a couple more months at the low
1.7 percent.

And that's how my skipping the fine print cost me.
When my second bill came in, I discovered that instead
of the company applying my payment to the new
purchases, it applied the money to the transfer
balance. As a result, the remaining balance was
subject to 14.99 percent interest, not 1.7 percent.

Outraged, I called the credit card company. I was
pointed to the original credit card offer, which I
happened to save.

In type about half the size of what you're reading
now, it states: "All payments and other credits to
your Account will be applied as determined at our
discretion, which may include applying these payments
and credits to balances subject to lower Annual
Percentage Rates prior to balances subject to higher
Annual Percentage Rates."

The moral of the story? Don't sign up for any credit
card offer until you read the fine print.

I thought about canceling the card in protest. But
I've decided the best revenge is to keep using the
card, pay off the balance every month, and earn a
cash-back bonus to make back the money I lost.

The Internal Revenue Service last week announced a
toll-free number to help people having difficulty
filing taxes as a result of the Sept. 11 terrorist
attacks: 1-866-562-5227, Monday through Friday, 7 a.m.
to 10 p.m. Some upcoming meetings about money:

State Treasurer Shannon P. O'Brien is hosting the next
two in a series of free money conferences for women
Oct. 27, at White's of Westport, and Nov. 10, at
Brandeis University. To find out more, call
1-800-711-4451 or go to

SIDEBAR: Cost of credit
A survey of 100 credit card offers released by state
Public Interest Research Groups this year revealed
these numbers.
19.03 percent - average annual percentage rate (APR)
for cash advances
4.31 percent - average cash advance transaction fee,
with an average minimum of $4.95
6.62 percent - average APR for balance transfers
22.84 percent - average penalty APR on accounts in
default or bad standing
SOURCE: "PIRG: The Credit Card Trap" WSGlobe staff