Pass This Credit Card Quiz and Cut Your Costs

One look at a typical cardholder agreement makes clear that credit cards come with plenty of fine print. Even so, a lot of information isn't readily available to cardholders, especially regarding what they can ask for from their card issuers and how they can manage their accounts more cost-effectively.

A recent NerdWallet survey found significant gaps in consumer understanding of credit cards — gaps that can be costly.

"The act of using a credit card is so simple, but they can be complicated products," says Sara Rathner, a NerdWallet credit cards expert. "Knowing what your card offers, and what you can ask for, can make it significantly more valuable for you."

Test your knowledge by taking the same quiz given to survey respondents.

1. True or false:

Moving credit card debt to a card with a lower interest rate or a 0% rate will always save you money in the long run.

A balance transfer can help you pay off debt more quickly, but it isn't always the best option. Moving debt from one card to another usually incurs a fee of 3% to 5% of the amount transferred. That fee could be more than you'd have paid in interest if you'd left the balance where it was and paid it off. So you have to compare costs. A balance transfer is effective only if it saves you money overall — and you use the money you save to pay down your debt even faster.

Answer: False. Survey respondents who answered correctly: 22%.

2. True or false:

Credit card issuers allow you to ask for an increase in your credit limit.

You can always ask your card issuer for a higher limit, although there's no guarantee you'll get it. The issuer will consider various factors beyond your account record, including your income, debts and credit history.

Answer: True.Survey respondents who answered correctly: 76%.

3. True or false:

Credit card issuers allow you to ask for a lower interest rate.

Similar to seeking a higher limit, you can certainly ask your card issuer if you qualify for a lower rate. You might not get it, but it's worth picking up the phone to ask, especially with an account in good standing. A lower interest rate means immediate savings if you typically carry a monthly balance.

"If your current card isn't working for you, it could be worth calling and asking for the change you want," Rathner says. "If you're a longtime customer in good standing, the answer might be yes. But if it's a no, then you can vote with your wallet and shop around for a card that's a better fit for your needs right now."

Answer: True. Survey respondents who answered correctly: 50%.

4. True or false:

Credit card issuers make financial hardship plans available to anyone struggling to make payments.

Some credit card issuers will temporarily lower interest charges or waive fees through a financial hardship plan for cardholders who can't make payments due to circumstances beyond their control. For instance, you might be eligible if you've lost your job or had a family emergency.

But while some issuers offer hardship plans, they don't make them available to everyone who asks. You'll have to qualify based on your circumstances. No one is guaranteed to be accepted.

Answer: False. Survey respondents who answered correctly: 18%.

5. True or false:

If you want to switch to a different card from the same company — for example, to get a lower annual fee or better rewards — you must ask the company to close your original account and open a new one.

Switching cards from the same issuer is called a product change. Since issuers don't widely advertise product changes, it's not surprising that many people don't understand how they work.

If you're unhappy with your current credit card because of its fees, rewards or other features, you can ask the issuer to switch the account to a different card that's better suited to your needs. You keep the same account; it just has a new credit card attached to it. Keeping the account open can benefit your credit since scoring models consider the length of your credit history, including the age of your accounts.

Answer: False. Survey respondents who answered correctly: 23%.

6. True or false:

Credit card issuers waive late fees.

Issuers don't broadcast that they'll consider waiving late fees, so it's not surprising that many people don't know it's an option. Not all issuers will waive fees. Those that waive them will do so at their discretion, and they'll consider it only if you ask. It's not unusual for an issuer to waive the first late fee for an account in good standing. If granted, that's a potential savings of up to $30.

Answer: True. Survey respondents who answered correctly: 37%.

7. True or false:

You can use a credit card without ever having to pay interest.

You won't be charged interest on purchases if you pay your credit card on time and in full monthly. If you carry a balance from one month to the next, on the other hand, you'll incur finance charges unless you have a promotional 0% annual percentage rate period in effect.

Putting purchases on your card and paying the bill in full each month avoids interest while still reaping the benefits of a credit card, such as fraud protection, rewards and others.

Answer: True. Survey respondents who answered correctly: 54%.

8. True or false:

Making the minimum payment every month on a credit card allows you to pay down debt quickly.

Paying only the minimum on a credit card every month can take years to get out of debt. The minimum is usually enough to cover the interest accrued over the past month, plus only a small fraction of the actual debt. Look at your credit card statement to see how long it would take at that rate. You'll see a table that shows how long it would take to pay off the balance if you made only the minimum payment.