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Choosing and Using Credit Cards
Beware of the Free Shirt! <ul><li>Many credit card companies offer students free items just for filling out an application...
But I have to have one to build my credit rating… <ul><li>While credit cards can build your credit rating, you can also do...
Credit Card Terms <ul><li>A credit card is a form of borrowing that often involves charges. Credit terms and conditions af...
Annual Percentage Rate (APR) <ul><li>The APR is a measure of the cost of credit, expressed as a yearly rate. It also must ...
When considering the APR <ul><li>Many cards offer “introductory” APRs that are very low.  </li></ul><ul><li>Read the fine ...
How it can add up quickly… <ul><li>For example: </li></ul><ul><li>20.9% APR </li></ul><ul><li>  $3000.00 current balance <...
Annual Fee <ul><li>Check the annual fee. Most incentive cards (for example, airline mileage) charge you an annual fee for ...
Free Period <ul><li>Also called a &quot;grace period,&quot; a free period lets you avoid finance charges by paying your ba...
Transaction Fees  and Other Charges <ul><li>A card may include other costs. Some issuers charge a fee if you use the card ...
If you decide to get a one… <ul><li>Do your research about what to look for </li></ul><ul><li>Shop around for the best car...
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Credit Cards

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Transcript of "Credit Cards"

  1. 1. Choosing and Using Credit Cards
  2. 2. Beware of the Free Shirt! <ul><li>Many credit card companies offer students free items just for filling out an application. </li></ul><ul><li>Every time you fill out an application it counts 10 points against your credit rating. </li></ul><ul><li>If you are approved you will soon have “cash” at your finger tips in excess of $5,000, which might sound good, until you get that first bill! </li></ul>
  3. 3. But I have to have one to build my credit rating… <ul><li>While credit cards can build your credit rating, you can also do that by putting your name, instead of your parents on utility bills or cell phone bills. </li></ul>
  4. 4. Credit Card Terms <ul><li>A credit card is a form of borrowing that often involves charges. Credit terms and conditions affect your overall cost. So it's wise to compare terms and fees before you agree to open a credit or charge card account. The following are some important terms to consider that generally must be disclosed in credit card applications or in solicitations that require no application. </li></ul>
  5. 5. Annual Percentage Rate (APR) <ul><li>The APR is a measure of the cost of credit, expressed as a yearly rate. It also must be disclosed before you become obligated on the account and on your account statements. </li></ul><ul><li>The card issuer also must disclose </li></ul><ul><li>the &quot;periodic rate&quot; - the rate applied </li></ul><ul><li>to your outstanding balance to figure the finance charge for each billing period. </li></ul>Credit Card Terms...
  6. 6. When considering the APR <ul><li>Many cards offer “introductory” APRs that are very low. </li></ul><ul><li>Read the fine print, they often </li></ul><ul><li>jump to as high as 20% after an </li></ul><ul><li>initial period of a few months. </li></ul><ul><li>Other have “hidden” APR jumps for late or missed payments. Even your first late payment can cause your rate to jump to 20%. </li></ul>
  7. 7. How it can add up quickly… <ul><li>For example: </li></ul><ul><li>20.9% APR </li></ul><ul><li>  $3000.00 current balance </li></ul><ul><li>$75.00 minimum monthly payment </li></ul><ul><li>$10.00 extra amount paid over monthly minimum </li></ul><ul><li>Results in a regular payoff time of 23 years, 5 months and 11 years, 6 months when making the per month extra payment. </li></ul>
  8. 8. Annual Fee <ul><li>Check the annual fee. Most incentive cards (for example, airline mileage) charge you an annual fee for having the card. </li></ul><ul><li>Look for a no annual fee card, if you cannot find one, then shop around for the lowest annual fee. It should not exceed $100. </li></ul>Credit Card Terms...
  9. 9. Free Period <ul><li>Also called a &quot;grace period,&quot; a free period lets you avoid finance charges by paying your balance in full before the due date. Knowing whether a card gives you a free period is especially important if you plan to pay your account in full each month. Without a free period, the card issuer may impose a finance charge from the date you use your card or from the date each transaction is posted to your account. </li></ul>Credit Card Terms...
  10. 10. Transaction Fees and Other Charges <ul><li>A card may include other costs. Some issuers charge a fee if you use the card to get a cash advance, make a late payment, or exceed your credit limit. Some charge a monthly fee whether or not you use the card. </li></ul>Credit Card Terms...
  11. 11. If you decide to get a one… <ul><li>Do your research about what to look for </li></ul><ul><li>Shop around for the best card </li></ul><ul><li>Talk to your parents about it </li></ul><ul><li>Only get one! </li></ul><ul><li>Use it for emergencies </li></ul><ul><li>only and pay it off every month </li></ul><ul><li>If you get into debt ask for help </li></ul><ul><li>immediately!!!!! </li></ul>
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