NEW YORK (MainStreet) — Always read the fine print. It’s become the mantra of virtually every personal finance adviser and website – ours included – and for good reason. Consumers are often in such a rush to skip through the fine print that in one case last year, online shoppers literally signed away their souls.

Still, taking the time to read the fine print is only half the battle. You also need to be able to understand what the fine print actually says, a task that sometimes seems impossible for anyone without a law degree, which is why we are particularly excited about the launch of a new Web service called Transparency Labs, which aims to decode the fine print on financial documents.

The website, which won’t launch until early 2012 but presented a demo at the Finovate financial tech conference in New York last week, is developing a vast database of the fine print commonly found in contracts and is working to translate those legal terms to provide consumers with a simplified overview of what their agreements say. In this way, users will be able to make a truly informed decision about whether or not to sign a contract.

“Right now people are making a lot of decisions based on advertising and marketing claims and not on the data that’s hidden beneath the iceberg of the fine print,” said Benjamin Texter, co-founder and vice president of Transparency Labs. “Most people think a credit card is a piece of plastic, but it’s not. It’s the 30 pages of agreements behind it.”

To fix this, Texter and his co-founder David Hirsch have a team of legal and personal finance experts who go through the fine print in contracts for credit cards, bank accounts, cellphones and retirement savings plans in the hopes of distilling it down to a 9th-grade reading level and assembling a glossary of 15 to 20 terms that pop up frequently in each category.

Once the team has put together this comprehensive database, consumers will be able to use it to analyze their actual statements and receive a breakdown of what is buried in the fine print. The full service is expected to launch in the first quarter of 2012 and may require a subscription, and as the demonstration above shows, it aims to break down contracts into an easy-to-understand summary report that comes with an overall assessment of the risks and costs connected to the terms.

According to Texter, the idea for the service came from a retirement seminar he went to three years ago, during which attendees were asked whether they were aware of the various fees that come with their 401(k)s and mutual funds. Most said they were not.

“People knew what they were paying for bread, milk and eggs, but how is it that they don’t know the price of their nest egg in hard dollars and cents?” Texter recalled feeling at the time.  “But then as I thought about it more, I realized there was this fine print economy that existed in all industries, not just retirement.”

Whether it’s that the actual fine print in contracts is getting longer and more complicated than it used to be Texter won’t say, but one thing that is clear is that consumers are engaging with a wider range of products that carry fine print, from cell phones to rewards cards.

Even the most responsible consumer likely has some difficulty parsing through the contracts of each and every product they purchase. At least until Transparency Labs formally launches next year though, consumers will have little choice but to do just that.

“For now I have to say to consumers, ‘Read the fine print,’” Texter said. “But that’s the problem we have to solve, to make that call to action much more meaningful than it is today.”

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.