One thing that has always bothered me about the financial services industry, is their consistently trying to trick the general public with confusing math. For example, a few days ago I saw an internet ad for “Savings account that pays 10 times the national average”. Well in 2007 when savings accounts paid 4%, that would be pretty big news. But when the average is paying .01%, a huge increase to .10% isn’t exactly headline news. The letter of their statement is true, but they are implying something that isn’t.
Then look at the opposite situation. “Save hundreds in interest charges with our low interest credit card”. That card carries a 12% interest rate. Well if you have $10,000 in debt on a card with a 20% interest rate then they are right. But paying 12% to borrow money when car loans are 2% and mortgages are 4% isn’t exactly a bargain.
When interest rates are very high or very low as in the examples above, percentages can tell a false story. Always do the ‘real’ math to see if you’re really being offered a deal. Don’t fall for their math tricks.