Jose recently became a peer financial advisor at his college. He was excited about this role, as it combined his love of personal finance with his desire to help others in his college community. He often found himself amazed by the lack of knowledge that students had about all things financial, whether it was checking accounts, credit cards or student loans. His parents had taught him valuable lessons growing up and his surprise came from the fact that most students didn’t have similar experiences with their families. 

Jose had recently seen more students coming forward to ask him for advice regarding credit cards. He wasn’t sure if it was peer pressure (one roommate telling another) or the influx of credit card spam that seemed to have hit student email boxes recently. In fact, just that afternoon, Michelle had come to his office with one of these credit card offers (seebelow). She could not contain her excitement:

“Hey Jose, I couldn’t believe this offer I got from a credit card company today. It’s amazing to me that they don’t charge me any interest and don’t make me pay them back. Am I missing something as this seems too good to betrue? I mean, what is the right way for me to evaluate such a great offer?”