Credit Cards. Today we will discover….. What is a credit card? Who can get a credit card and how? The features of a credit card What happens if you lose.

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Presentation transcript:

Credit Cards

Today we will discover….. What is a credit card? Who can get a credit card and how? The features of a credit card What happens if you lose a credit card? How to read a credit card statement

What is a credit Card? A credit card is a plastic card used to access a line of credit that has been established in advance. The cost of credit is expressed as interest. – U.S. statistics show the average family has long- term credit card debt in excess of $5,000

The smallest amount that can be paid in order to keep the account current is called the minimum payment.

Who can get a credit card? Over 21- credit history and proof of sufficient income to make payments Under 21- must have a co-signer or have proof of sufficient income to make payments A Pre-approved credit card application- means that a person has passed the initial credit check.

Credit Card Features ) Annual Percentage Rate APR The cost of credit expressed as a yearly interest rate The APR can fixed or variable.

Credit Card Features Cash Advance Rate May include fees as well as interest rate on amount of $ advanced

Credit Card Features Balance Transfer Rate Happens when a person switches balance from one card to another

Credit Card Features Introductory Rate Usually lower rate for a set period of time afterward it increases to a pre-determined rate.

Introductory Rate Usually a lower rate for a set period of time, afterward it increases to a predetermined rate

Credit Card Features Annual Fee-yearly fee that may be charged for having a credit card Late Fee- charged when a cardholder does not make the minimum monthly payment by the due date. Over the Limit Fee- charged if the account balance goes over the set credit limit

Credit Card Features Grace Period-The credit card issuer will allow you a certain number of days to pay your balance in full on the due date before tacking on a finance charge.credit

Credit Card Features Rewards – Frequent flyer miles – Warranties for items purchased – Travel insurance – Cash rebates Do the benefits outweigh the costs?

Lost Cards Report lost or stolen cards IMMEDIATELY! How much are you liable for? $0 is reported before it is fraudulently used $50 if it is used without authorization

Debit or Credit

Credit Card Statement

The Schumer Box A Schumer Box is an easy-to-read table or “box” that discloses the rates, fees, terms and conditions of a credit card agreement as required under the Federal Truth in Lending Act

Real Life Story

Activities: Shopping for a Credit Card Reading a Credit Card Statement