6 credit card traps and how to avoid them

Many people use credit cards to their advantage, racking up cash rewards and other perks for being good customers. But credit cards often come with tricky features that can cost you — triggered by a missed payment or other misstep.

Here are six common traps, and tips for how to avoid them.

Minimum monthly payment. Card issuers vary on how they calculate the minimum monthly payment. Some charge a flat 2% to 3% of the balance, while others charge 1% of the balance plus any interest or fees owed that month. Paying only the minimum is a debt trap because it can take years to repay a sizable balance that continually accrues interest.

Tip: If you can't pay your monthly balance in full, pay as much as you can above the minimum.

0% interest. Some card promotions won't charge interest for set time frames — like 12 or 18 months — on new purchases, balance transfers, or both. Since the card issuer doesn't have to notify you when the promotion ends, keep track of the dates yourself. If you're still carrying a balance when the promotion ends, you'll be charged interest at a new rate that could be steep, depending on your creditworthiness.

Tip: When transferring a balance to a 0% interest card, make sure you pay it off before the promotion ends.

Deferred interest. More than half of retail credit cards that offer an interest-free promotion also have a feature called "deferred interest," reports WalletHub. That means if you're late with a payment or still have a balance when the promotion ends, the card issuer will charge interest retroactively on your purchases.

Tip: Think twice about making a purchase with deferred interest if you won't be able to pay off the balance before the promotion period ends.

Cash advances. Short-term cash loans from a credit card come with a fee, generally the greater of $10 or 5% of the advance sum. You'll also be charged a higher interest rate on the advance, often around 24%, and interest starts accruing immediately.

Tip: Consider less expensive loans, such as a personal loan from a bank or credit union, or borrowing from a family member at a low interest rate.

Cash and travel bonuses. Some cards will credit your statement with a bonus in cash or travel miles if you charge a certain amount within the first three months of opening an account.

Tip: Make sure the card meets your spending needs so you're not racking up purchases — and possibly interest — just to get the bonus. Review the card's other terms, too — some charge an annual fee that erodes the value of the bonus.

Changing terms. Your card issuer must notify you no later than 45 days before significant changes to your terms, such as an increase in fees or interest rate, take effect. But it doesn't have to give advance notice of changes to rewards programs or lowering your credit limit.

Tip: For example: Did your issuer raise your interest rate because you were 60 or more days behind in payments? Your old rate could possibly be reinstated if you make six months' worth of on-time payments. Check directly with the issuer.