1. Analyzing a Credit-Card Statement
Activity 3.3

2. Using credit cards wisely
Video 3 introduces key ideas about credit cards
Many people use credit cards wisely, as for emergency situations
But credit cards can fool you – and you may end up in debt over your head
July 14, 2019
Activity 3.3

3. Credit cards vs. debit cards
Read Part 1 of Student Activity 3.3 carefully.
Questions for Discussion A through C refer to this reading
July 14, 2019
Activity 3.3

4. Questions for discussion: A
What is a debit card?
July 14, 2019
Activity 3.3

5. Questions for discussion: B
What is a credit card?
July 14, 2019
Activity 3.3

6. Questions for discussion: C
What are three tips for using a credit card wisely?
July 14, 2019
Activity 3.3

7. The big list: using credit wisely
Have only one card
Close any credit-card accounts you don’t use
Shred unused credit-card applications
Pay off the monthly balance
Shop for a card with a low interest rate and no annual fee
Use your card for travel and emergencies
Use credit-card records to track your spending
Avoid using your card for minor purchases
July 14, 2019
Activity 3.3

8. An important exhibit
Read Part 2 of Student Activity 3.3 and study the credit card statement (next two slides). Then Part 2’s Questions for Discussion A through G will appear on that statement.
July 14, 2019
Activity 3.3

9. RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

10. RALPH’S PRETTY GOOD DEPARTMENT STORE (statement continued)
use ACCOUNT NO. on correspondence K F
BILLING DATE APR
PREVIOUS BALANCE
NEW BALANCE
MINIMUM PAYMENT
To avoid a FINANCE CHARGE next month, pay the NEW BALANCE shown above within 30 days (28 days for February statements) from BILLING DATE. If you prefer to pay in installments pay the MINIMUM PAYMENT shown above, or more, within 30 days (28 days for February statements) form BILLING DATE. The sooner you pay and the more you pay, the smaller your FINANCE CHARGE.

11. A. What is the finance charge for the current billing period?
RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
A. What is the finance charge for the current billing period?
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

12. RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
B. What is the annual percentage rate if the unpaid balance is over $500? Less than $500?
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

13. C. What is the minimum payment due?
RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
C. What is the minimum payment due?
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

14. D. What is the total amount charged for purchases made during the previous month?
RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

15. E. How much credit does Joan Berelli still have available?
RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
E. How much credit does Joan Berelli still have available?
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

16. F. What is the new balance?
RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
F. What is the new balance?
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

17. G. How is the new balance determined?
RALPH’S PRETTY GOOD DEPARTMENT STORE
JOAN BERELLI 1616 ELM STREET MIDDLETON, MA YOUR LINE OF CREDIT IS YOUR AVAILABLE CREDIT IS
$1000 $ 638
AMOUNT DUE THIS STATEMENT NEW BALANCE $ $
G. How is the new balance determined?
Mo.
Day
Reference
TRANSACTION DESCRIPTION **FINANCE CHARGE ON AVERAGE DAILY BALANCE OF $ IS
CHARGES $5.64
PAYMENTS & CREDITS
03 03
24 29
PAYMENT WOMENS WEAR 29 SWEATER 43
38.76
18.00
ON AVERAGE DAILY BALANCE OF:
MONTHLY PERIODIC RATE
ANNUAL PERCENTAGE RATE
$.01 TO $33
MIN. FINANCE CHARGE $.50
FINANCE CHARGE RATE(S)
$33.01 TO $ $ AND ABOVE
1.5% 1.25%
18% 15%

18. Conclusion: Knowing how to read a credit card statement is a useful skill in managing credit.
You get the advantage of “buy now, pay later”
To make good decisions, it’s important to know how much credit costs you
July 14, 2019
Activity 3.3