3 money lessons from "The Bachelor"

By Gina Roberts-Grey

If your Monday evenings are filled with the drama that only the 16th season of ABC's "The Bachelor" can provide, you're tuning in for a lot more than a weekly round of romance, heartbreak and healthy dose of rose-infused reality.

Turns out, week after week, the show hands you a virtual rose in the form of numerous lessons that can be applied to your finances and relationship with credit cards.

For example:

Lesson No. 1: Is it time to move on?

Even if there are sparks and fireworks during those first few encounters, a wise bachelor knows when it's time to cut his losses and hold out on giving a rose to a contestant his gut says isn't right for him.

And the same goes for your credit cards.

The prospect of pairing up with a new piece of plastic may seem dreamy in the beginning, especially if your card issuer woos you with thousands of sign-on bonus points and a zero-percent introductory APR. But if any card -- new or otherwise -- isn't working to your advantage, it's time to break up.

How can you tell it's time to sever the relationship?

"If the terms of the credit card have changed; for instance, what was a 'no-fee' card now has an annual fee or the interest rate is higher than what you can snag with another card, it's time to move on," says Rita Cheng, a financial adviser and certified financial planner at Ameriprise Financial Services. Experts warn against opening and closing too many cards at once, however, as that can harm your credit score, so be selective about which cards you should keep or toss.

Other signs it's time to consider giving a different credit card your attention: You're being treated like a second-class citizen by your card issuer and aren't receiving good (or any) customer service, your rewards are shrinking, or the card issuer has placed new restrictions on how and when you can tap into them.

Lesson No. 2: Do your homework before you make a commitment

How in the world is a Bachelor supposed to get to know his potential soul mate with 20 or more other would-be wives trying to cozy up to him at the same time? That's where scoring a little one-on-one 'quality time' to dish about personal details on a private date is important. That quality time helps the bachelor decide if it's a match made in heaven -- or not. 

Likewise, spending time becoming familiar with the terms and conditions of a potential new credit card can prevent you from being locked into a financial relationship you're not happy with.  

Talking one-on-one to a credit card issuer before accepting a preapproved card card or applying for a new card is the best way to prevent a problem down the road, says Craig Steinhoff of the American Institute of Certified Public Accountants National CPA Financial Literacy Commission. 

Steinhoff suggests calling a card issuer to ask about penalties and fees that could apply if you were to miss a payment (whether due to financial woes or forgetfulness), what other offers the card issuer may currently have that might fit better with your lifestyle (what other reward programs are offered, what other interest rates or introductory APRs are available, etc.), and what the process is to have a credit line increased -- should that need arise down the line.

Being proactive cuts down on the odds you'll make a commitment to a credit card that turns out to be all wrong for you.

Lesson No. 3: Don't fall for gimmicks

On the show, contestants have a limited amount of time to win the bachelor's affection. That typically results in the women resorting to gimmicks or deceptions they hope will set them apart from their competitors.

However, once the bachelor digs deeper, the truth is often revealed. And sometimes the truth is ugly -- as is the tear-soaked mascara that runs down a contestant's face when her maneuverings are uncovered.

Like contestants seeking the bachelor's affection, credit cards often rely on smoke and mirrors. Card issuers know you're busy and bank on you not having more than a few seconds to sift through all the lingo in an offer that makes its way to your mailbox. So they throw out the splashiest enticements (like zero-percent interest and double rewards) all aimed at grabbing your attention while distracting you from the inner secrets buried in the terms and conditions.

Kelley Long, tax accountant and owner of KCL Financial Coaching in Chicago, says just like in true love, "if it sounds too good to be true, it probably is, especially when it comes to financial products." And to sidestep the sting of gimmicks, she suggests reading the terms and conditions of every card carefully. "That's the best way to learn about late fees, grace periods, changes in APRs, fees, and more," she says.

Other tricks to be wary of include having to charge thousands of dollars before you are officially awarded the allotted bonus reward miles or points. "This is the card issuer's way of getting you to use the card. The issuers anticipate you'll swipe your card on something more than a small purchase," which means they'll make money on any outstanding balances, which is often more than what they're giving you in bonus points, says Long.

Unlike on "The Bachelor," the clock isn't ticking. There's no rush to decide whether or not to give a card issuer a rose. Take the time to research options and evaluate them to make the correct decision so unlike on most seasons of "The Bachelor" you'll find true love -- with the cards tucked in your wallet.

See related: Top 10 credit card television episodes, Money and credit lessons learned from TV

Published: February 1, 2012

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