10 Reasons to Avoid Credit Cards

3. They charge huge interest rates.
Most investors would jump at the opportunity to receive a guaranteed annualized return of 15%. Credit card companies charge interest rates on some cards that more than double that rate, and when you are borrowing money with double-digit interest rates, it isn't going to help your finances. Interest is wonderful when you are the one saving, but it's the enemy when you are the one paying.

4. They come with numerous fees.
While credit card companies make a lot of money on interest charges, they make nearly as much on fees. If you make a payment late, you can expect a hefty late fee. If you go over your card limit, you'll have another fee added to your bill. If you want a special-reward credit card, you may need to pay an annual fee. If you want to transfer a balance from one card to another, you can expect a balance transfer fee. If you use your credit card outside the U.S., you'll likely find a foreign-exchange fee. If you are not careful with your credit card, it's possible to pay more in fees than in interest.

5. Many cards have a hidden rule in the fine print.
If you actually read the fine print when you sign up for a credit card, you'd likely be surprised at how much the contract favors the credit company. The company makes the print small so that you don't feel like reading it, but it's in your best interest to do so. For example, that "fixed" interest rate card that you assume will stay at the same interest rate forever likely will not. The fine print will reveal that it's only fixed at that rate until the company gives you two weeks' notice that the rate will go up. You'll also find that you give up your right to take the credit card company to court for any dispute you may have. There are a lot of other similar examples hidden in that fine print.