Christmas Shopping and Deferred Interest
Christmas time and deferred interest seem to go together like Santa and reindeer, but what exactly is deferred interest? WalletHub reports that credit card debt is on the rise and 82% of people unaware how deferred interest works. Deferred interest is when a retailer advertises a low introductory APR – often 0% – and gives a consumer the chance to pay for their purchases without interest for a certain number of months (6, 9, etc.), only to hit them with retroactive interest charges if the balance isn't paid off at the end of that time. It's fine if you have a realistic game plan to pay off the balance within that 0% time period. Otherwise, it can be a very expensive way to go. The worst scenario would be if someone made no payments during that time, because at the end of that period the balance will soar due to the finance charges added onto the original purchase amount.
