Answer (based on a paper from MIT economists): YES

Want to motivate your students to be educated about the wiles of credit card companies? Here’s a summary of that paper which should catch their interest (bold type is mine):

We look at the supply side of the credit card market to analyze the pricing and marketing strategies of credit card offers. First, we show that card issuers target less-educated customers with more steeply back-loaded fees (e.g., lower introductory APRs but higher late and over-limit fees) compared offers made to educated customers.

So, there you have it..card companies target those 0% APR cards (seems too good to be true) that carry with them spring loaded interest rates after the introductory period and higher fees to less educated customers.

Additional sources:

• Credit Card Companies Know How Little You Know (Bloomberg)

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.