Let's get one thing straight: I don't think you're an idiot, but a lot of credit card companies out there do. They know there is a high probability that you will mismanage money and consequently go into debt – ultimately netting them more money and making it impossible for you to get ahead.

Credit card companies are betting you're too young to understand this rule of thumb: If something sounds too good to be true, it probably is. Here are a few situations to watch out for:

The second you turn 18, credit card companies flood you with all kinds of offers and junk mail. That's because you can now legally sign yourself up for a credit card. They want to sign you up before you know what you're doing – after all, you're just a stupid teenager or twentysomething, right? Wrong.

Free iPod Nano? Free sandwich? Free T-shirt? All you have to do is sign on the dotted line...

Credit card companies know that if they can legally get your name on an application or mail you a pre-approved card, there's a pretty good chance of you activating it. So, they set up sidewalk booths and give away free stuff at colleges (or nearby if they aren't allowed directly on campus).

Make you kind of sick? That's why a lot of student groups and politicians are advocating stricter rules about pitching cards on campus. If your school won't prohibit this type of exploitative marketing, ask them to at least require the companies to provide educational information. Maybe they could print debt management tips on those free T-shirts.

Many credit card companies offer really good "starter" rates, betting that you won't read the fine print. You'll see phrases like "0% APR" or "no annual fees," but those rates usually skyrocket after a few months, and fees often get bumped up if you're late on a single payment. Pretty soon you're only paying interest and fees, and never actually paying off the pizza you ordered at 1 AM two years ago.

Credit cards are important, as is building credit (see our articles on brassmagazine.com about building good credit). However, if you sign up for the first card offer to come in the mail or think you've scored free swag, keep in mind, you'll be paying for that free stuff one way or another.

As one of the most profitable industries out there, credit card companies aren't in the business of giving you free stuff just for the fun of it. When you need a credit card, do your research; compare the terms, rates, and fees; and make an educated choice.

And the next time you see someone getting duped at a credit card sign-up table, pass the word along.
Bryan Sims, CEO