Do you know what’s in your wallet? More to the point, do you know the terms and conditions of your credit cards?

If you’re like many cardholders, you probably don’t. A report released recently by the Government Accountability Office concluded that while credit-card use has become widespread, millions of consumers are whipping out their plastic with little knowledge of the terms of their credit agreement.

Over the past 25 years, the use of credit cards in the United States have grown dramatically with more than 691 million currently issued to consumers. Between 1980 and 2005, the amount that U.S. consumers charged to their cards grew from an estimated $69 billion per year to more than $1.8 trillion, according to CardWeb.com Inc, a firm that analyzes the industry.

So why is a product so widely used so widely misunderstood?

It’s a failure to communicate.

“Although issuers must disclose information intended to help consumers compare card costs, disclosures by the largest issuers have various weaknesses that reduced consumers’ ability to use and understand them,” the GAO reports finds.

The credit card companies seem to be designing the disclosures for a colony of ants, using a tiny text in the least legible typeface known to man. The required disclosures often are poorly organized, with important information scattered throughout various sections, according to the GAO.

In addition, the language in the credit card disclosures is difficult to comprehend. Although about half of adults in the United States read at or below the eighth-grade level, most of the credit card materials were written at a 10th- to 12th-grade level, the GAO found.

Because of the poor quality of the disclosure statements, many cardholders are not informed enough.

For example, they may not know they are charged up to three different interest rates for different transactions on the same card. They may not know their particular issuer has the right to raise their interest rate based solely on their payment to other creditors.

So what can the average person get from the GAO report? There are big differences in the credit policies among companies.

For example, in the GAO’s analysis of 28 popular large-issuer cards, 22 cards assessed over-limit fees. But it varies as to when that fee is assessed. About two-thirds (14 of 22) assess the fees if the cardholder’s balance exceeds the credit limit within a billing cycle, and eight of 22 would assess the fee only if a cardholder’s balance exceeds the limit at the end of the billing cycle.

If you have a habit of going over your limit (which you need to stop), you might want to find a card with an end-of-the-month policy, which might give you time to pay the balance down before you are hit with a fee.

And trust me, fees matter.

Penalty fees such as making a late payment average almost $34 in 2005, up from an average of about $13 in 1995. Exceeding a credit limit can cost you an average of about $31 in 2005, up from about $13 in 1995.

Somewhere deep in the disclosure, you might find that your card issuer has separate credit limits for cash advances and transfers from other cards or creditors before triggering an over-limit fee.

Four of the six largest issuers typically allow a cardholder’s interest rate to be reduced from a higher penalty rate if he or she abides by the terms the card agreement for a period of six or 12 consecutive months.

However, at least one issuer indicated it would still apply that higher penalty rate on existing balances even after six months of good credit behavior. This issuer applied the lower non-penalty rate only on new purchases or other new balances.

How sneaky of them.

“This practice may significantly increase costs to cardholders even after they’ve met the terms of their card agreement for at least six months,” the report points out.

You might want to stay away from issuers that use the double-cycle billing method. With this type of billing, the interest you are charged is based on your average daily balance over a two-month period.

Without question, the disclosure to consumers has got to get better. But as cardholders, we do have something working in our favor. The credit card industry is so competitive right now that if you play your cards right (OK, pun intended), you can find a company with policies that minimize the fees and penalties you are assessed.

Of course, you know in playing the credit card game, the odds are stacked against you. But you can win one of two ways. Use cash. Or know the rules, which means you need to buy a magnifying glass and get to reading.