Using Credit Wisely

Hannah Groce

Differences between credit and debit

CREDIT: Credit is money you borrow from the bank with the promise of paying them back. When you pay money back borrowed you have to pay interest along with the money you already owe.

DEBIT: Debit is the money you use directly from your own bank account

How to obtain positive credit

  • Make sure you pay all payments on time, this will help you avoid late fees
  • Avoid going over your credit limit, if you go over you will have to pay that money back it will show up as a negative on your credit report
  • Try to pay all bills quickly, paying the minimum payment each time will end up costing you a lot more money than what it would have if you payed more up front

Betterment

Betterment is an online money managing website that will help an individual with their investments. With Betterment you will get your own customized portfolio that you can use to help you decide what you want/need to do with your money. With Betterment you may also record your earnings from your investment right from the website.

Dwolla

Dwolla is an online transaction of money from one bank account to the other. This website can help you plan what money you need and where. You can move money from savings to your checking account right on this website.

Popmoney

Popmoney is an online way to send or receive money from other people. This website allows you to send your money to another person via an email through the website. This would allow you to instantly be able to give or receive money.

LearnVest

LearnVest is an easy online way to be able to plan for your future financial needs. LearnVest allows you to look at different money plans to find the one that best fits your needs.

Square

Square is an online website that allow you to verify credit cards. It is an easy way to get your business cards ready for the job instead of having to use your personal credit card. Square is also known for its security of your personal information.

Advantages and disadvantages of using credit

Advantages:

  • Instant cash
  • Convenience
  • Record keeping
Disadvantages:

  • People commonly over use credit
  • Unexpected fees
  • Paperwork

APR

APR stands for annual percentage rate, which is the annual rate charged for interest. This will add costs to your end of year charge.

For example, it you were to buy something that costs $1,000 with 18% interest and payed $75 a month, it would take you 15 months and you would end up paying $124.06 over the original money you spent.

Free credit report

To get your free credit report you must order it from Trans Union, Equafax or Expeirian. Most places will charge you to get your credit report but once a year you may get it free from these places. If you notice a problem with your credit report you should immediately report it so that it doesn't become a negative thing that sticks with your report. You report these problems directly to your credit company.

Financial difficulties

If you are having troubles with your credit you may go to credit counselors that will help you get on the right track with your creditors and can have a complete financial plan ready for the future.

Examples

  • Apprisen
  • Consumer credit counselling