Talk to a debt counselor toll free:800-300-9550
Our Clients Rate Us Excellent
Based on 3234 reviewsTrustPilot Reviews
These are credit cards that are accepted only by healthcare professionals and must be used for medical expenses. In some cases, they can be just what the doctor ordered. On the other hand, they can also make patients financially sick. There are cards available from companies such as CareCredit, which is a subsidiary of GE Capital Retail Bank as well as from Wells Fargo and Citibank. These cards are usually interest-free from three to 18 months. The downside is what happens if you don't pay off your balance before your interest-free period expires. In this case, all of the past interest may be added to your balance and becomes your liability. When the interest rate does kick in – assuming you don’t pay off your balance – it can be as high as 27% or more. And because health care can be so expensive, it's very easy to carry forward a balance, which can quickly become very high because of the interest expense.
6. Credit card protection
Credit card protection policies claim that they will cover you in the event your card is stolen. However, these services are already available from your bank or may be part of your homeowner’s insurance policy and at a cheaper price.
7. Expensive tracker funds
If you're not familiar with tracker funds these are ones that let you invest in a group of companies and then follow their performance. However, some of these funds charge two or three times the normal rate to manage your money, which could very well eat into your returns.
8. Gift cards
One of these cards can be a good gift if you keep the value small. However, if the company goes bankrupt its administrators have no obligation to accept their cards and you or the person you gifted might be totally out of luck.
9. Credit monitoring services
There is numerous credit monitoring services available including LifeLock, TrustedID, IdentityGuard, etc. They all work about the same way, which is to track your credit report from one, two or three of the credit-reporting agencies – Experian, Equifax and TransUnion – and then send you an alert immediately if they discover suspicious activity. Many of them provide limitless access to your credit report from at least one of the agencies as well as credit score tracking, and even telephone support to help you with fraud resolution. However, when you see statements like “ $1,000,000 identity theft guarantee,” understand that this covers only your out-of-pocket expenses to get your identity restored such as lawyer’s fees, the cost of consultants, etc. but not any money you’ve lost. You could monitor your credit yourself just by getting your three free credit reports one at a time at three month intervals. And most credit card companies limit your losses to $50 in the event that your identity is stolen. So the cost of these services, which is usually $10 to $15 a month, is probably not a wise investment unless you've already had your identity stolen.
10. Payment protection policies
Credit card companies are infamous for offering these policies. What they purport to do is cover your payments in the event that you are unable to make them. However, these policies often come with a number of exclusions so it can be difficult to get a payout. Plus, they can be expensive. You would really be better off building up an emergency fund you could use to make your payments in the event you were unable to do so.
11. Department store credit cards
It can be very tempting to apply for one of these cards because they're usually associated with a nice discount offer. "Apply for our store card today, and I can take 20% off the cost of that purchase." The problem is that they usually have very low limits and high interest rates. You can't use them anywhere but the store where you got them and they never come with any kind of rewards. They are not looked on as favorably as major credit cards when it comes to your credit score. The fact is you would be better off getting a major credit card with a competitive interest rate that comes with cash back or some other type of rewards.
12. Whole life insurance
This type of life insurance might be good for some people but not for most. An insurance agent will try to sell you one of these policies based on the fact that it builds cash value. However, in most cases you would not be able to afford premiums large enough to get a significant cash return. You’d probably be better off getting a term life policy and then using the money you save to invest in something that would generate a higher return over time.