1. An educational partnership between Consumer Action and American Express Credit Cards What You Need To KNOW

2. An educational partnership between Consumer Action and American Express Welcome Ken McEldowney, Consumer Action Executive Director Jane Shock, American Express Center for Community Development Vice-President & CRA Officer

3. An educational partnership between Consumer Action and American Express Welcome Mikael Wagner, Consumer Action Director of Training and Outreach

4. An educational partnership between Consumer Action and American Express Overview What’s in your folder: Brochure Training guide Activities (Pages 22-34) Powerpoint slides Material Order Form Training Evaluation Reimbursement Form

5. An educational partnership between Consumer Action and American Express Activity: My Story Select a spokesperson Select a recorder Create the cover of a book Popular song, movie or show Expectations (2 to 3) 10 minutes to network. Share out

6. An educational partnership between Consumer Action and American Express Types of Cards

7. An educational partnership between Consumer Action and American Express Credit cards Revolving Credit Credit line can be used up to the credit limit Pay charges in full each month, pay just the minimum or make a partial payment greater than the minimum due Credit limit goes up and down as purchases and payments are made

8. An educational partnership between Consumer Action and American Express Charge cards Pay all charges in full every month by the due date Cannot carry a balance No balance = no interest Some charge cards allow a balance carry-over for specific purchases, such as travel charges No preset spending limits or credit limits

9. An educational partnership between Consumer Action and American Express Secured credit cards Guaranteed by money deposited in an account Credit limit usually equals the amount of the deposit Can be used by people with credit problems to reestablish good credit

10. An educational partnership between Consumer Action and American Express Sub-prime credit cards Marketed to people who have poor credit Typically have very low lines of credit, large upfront fees and high interest rates

11. An educational partnership between Consumer Action and American Express Stored Value Cards Also called prepaid cards These are used by retailers as gift cards travelers as a safe way to get funds on the road parents who want to give their kids the convenience of a credit card without the risk

12. An educational partnership between Consumer Action and American Express Types of offers Pre-approved Invitations to apply Offers come in the mail, by telephone and online Instant credit at stores

13. An educational partnership between Consumer Action and American Express Card Terms and Conditions

14. An educational partnership between Consumer Action and American Express Cardholder agreements Sent with every new card Legal contract between consumer and the card issuer By using the card, consumer agrees to honor the terms and conditions in the agreement

15. An educational partnership between Consumer Action and American Express Subject to change Card terms and conditions are subject to change at any time Change notices are usually sent by mail, along with the monthly statement Consumers should review everything sent by issuer, even if it looks like junk mail Using the card after receiving the notice means that you accept the changes, even if you have not read the notice

16. An educational partnership between Consumer Action and American Express Annual percentage rate (APR) Card’s interest charge, expressed as a yearly rate The interest rate is the cost of borrowing money from the credit card company Your card’s interest rate is usually for purchases — if you withdraw cash you might be charged a higher interest rate

17. An educational partnership between Consumer Action and American Express Variable rates If card has a variable rate, the APR will change when interest rates go up or down Variable interest rates change according to a set formula using an “index” and a “margin” The most common index is the Prime Rate published in the business sections of major newspapers and online

18. An educational partnership between Consumer Action and American Express Fixed rates Despite their name, fixed interest rates can change as early as 15 days after the company gives notice of a new rate

19. An educational partnership between Consumer Action and American Express Default or penalty rates Higher interest rates charged for late payments or decline in credit Default factors Late payment Bounced check Reduction in credit score Higher rate will apply to the existing balance, not just new purchases

20. An educational partnership between Consumer Action and American Express Default with other creditors Some companies apply a default or penalty rate if consumer fails to make timely payments on their other credit cards or loans with other banks This is sometimes called “universal default”

21. An educational partnership between Consumer Action and American Express Grace period The time between the close of the billing cycle and the payment due date, after which finance charges are assessed If you do not carry a balance from the last credit card bill, interest will not be charged if the new bill is paid in full by the due date

22. An educational partnership between Consumer Action and American Express Gotta go, gotta go Let’s take a 10 minute stretch break

23. An educational partnership between Consumer Action and American Express Credit Card Billing Statements

24. An educational partnership between Consumer Action and American Express Minimum monthly payment The lowest amount you are required to pay each month Paying more than the minimum helps reduce the amount of interest owed on the card Paying just the minimum amount does very little to reduce the amount owed

25. An educational partnership between Consumer Action and American Express Payment due date The last day that payment can be accepted without penalty, (20-30 days after close of billing cycle? If payment is not received by the due date, a late fee will be charged Some companies require payment to arrive before a cut-off time on the due date.

26. An educational partnership between Consumer Action and American Express “Effective” APR The effective APR includes all fees and charges By law, your effective APR must be disclosed on your billing statements This disclosure is designed to show you how costly it can be to pay late fees and other penalty fees Read your statements

27. An educational partnership between Consumer Action and American Express Dispute Rights Has anyone ever found a mistake on credit card statement or bill? What do you do?

28. An educational partnership between Consumer Action and American Express Dispute Charges You can dispute charges for: The wrong amount Something you didn’t accept An item or service that was not delivered

29. An educational partnership between Consumer Action and American Express Credit Card Fees

30. An educational partnership between Consumer Action and American Express Credit Card Fees How do you avoid credit card fees?

31. An educational partnership between Consumer Action and American Express Annual fees Fewer than half of all cards now have annual fees Annual fees are common on charge cards, “rewards” and airline miles credit cards If you do not make at least a few charges during the year for “inactivity”

32. An educational partnership between Consumer Action and American Express Annual fee tips Consider the overall value of a card when comparing fee and no-fee cards For cards with airline miles or other rewards, make sure the card’s benefits and services are worth the price of the fee

33. An educational partnership between Consumer Action and American Express Application fee tips Secured credit cards are generally much better deals than sub-prime credit cards Many sub-prime cards — and some secured cards — charge a fee when an account is opened You can find secured credit cards that don’t charge application fees FMI - Check out www.bankrate.com to find companies offering secured cardswww.bankrate.com

34. An educational partnership between Consumer Action and American Express Balance transfer fee Charge for transferring a balance from another credit card Commonly assessed as a percentage of the cash advance (for example, 3%) When applying, ask about balance transfer fees Most companies don’t charge fees to new cardholders for the first month or two

35. An educational partnership between Consumer Action and American Express Cash advance fee Commonly charged as a percentage of the cash advance (for example, 3%) Minimum charges are common Expensive way to get cash Interest accrues immediately Use your ATM or debit card to withdraw cash from your bank

36. An educational partnership between Consumer Action and American Express Currency conversion fee Fees charged for purchases made overseas, or purchases made from companies based outside the U.S. Fees may vary Traveling abroad

37. An educational partnership between Consumer Action and American Express Late fees Always pay bills on time to avoid fees Allow at least 7 days for the payment to arrive Consider online bill pay, pay-by-phone or automatic payments from bank account

38. An educational partnership between Consumer Action and American Express Credit limits Avoid credit cards that charge when over the credit limit (11) Know your credit limit Keep your credit in good shape by accessing no more than 50% of your credit limit at any time Call when an increase is needed Find out if there is a free e-mail alert

39. An educational partnership between Consumer Action and American Express Card Options & Benefits

40. An educational partnership between Consumer Action and American Express Optional services Most card issuers offer optional services for a fee These may include credit protection insurance or fraud prevention plans

41. An educational partnership between Consumer Action and American Express Your choice You do not have to buy optional services Not buying them will not affect your card application or change the terms of the card Before making a decision on whether to purchase optional services, get detailed information and review the limitations and restrictions of the service

42. An educational partnership between Consumer Action and American Express Free benefits Zero liability if your card is used to make purchases without your authorization Cash rebates or merchandise rewards Rental car “collision damage waiver” (CDW) coverage Buyers’ protection against loss and theft Extended warranties on items you buy using your card

43. An educational partnership between Consumer Action and American Express Common fee-based services Credit protection services Identity theft monitoring services

44. An educational partnership between Consumer Action and American Express Credit protection insurance Make your loan payments if you die, become ill or unemployed Coverage is quite expensive There are significant limitations

45. An educational partnership between Consumer Action and American Express ID theft monitoring services Credit monitoring companies charge a yearly fee to check your credit report Alerts you if information in your report changes, such as reviews by potential creditors or new accounts You can check your credit report yourself for free

46. An educational partnership between Consumer Action and American Express Thank you! For more information contact us at: info@consumer-action.org Toll free: 800-999-7981 Web Site: www.consumer-action.org