Information About Credit Cards

What students need to know

Bridgette Brown

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"I think the convenience of credit cards is very helpful, but also tempting."

-Josh Hunter

Positives and Negatives

Positives:
  • It's great for emergencies
  • It's great for things you don't have money for now, but you will in the future

Negatives:

  • It builds debt fast when you don't pay the bills
  • They have high interest rates, APR's and hidden fees (If you don't read the fine print, there good be hidden fees)

What You Should Know

You should shop around for a credit cards. Do not get the first one you get in the mail. The credit cards sometimes have hidden fees in the fine print-which people don't read. Interest rates and APR's are often higher for first time credit card holders and students. Interest rate is usually expressed as a annual rate.

You might want a credit card for emergencies. You might not want to get a credit card if you know you aren't going to pay the balance on time.

What You Should Look For

Grace periods are an important factor. A longer grace period ensures that you have time to pay your balance on time. Annual fees are also an important factor. They can be in the fine print or straight on your bill/ on the ad. Annual fees can be expensive. Interest rates and APR's can also be expensive, depending on what card it is and what the card is for.

What You Should Be Aware Of

You might pay late fees if you don't at least pay the minimum balance. These can be up to $40, and they can add up quickly. The APR can change when you've had the card for 12-15 months. The change is almost always an increase. You can be charged a balance transfer fee when you want to transfer a card's balance to one with less amount of money on it.

Important Terms

Late fees- a fee you pay when your payment is late

APR- annual percentage rate

Credit history- a consumers history of paying debt

Credit score- a number given to someone based on their ability to pay back debt