The ABCs of Credit Card Finance Essential Facts for Students

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The ABCs ofCredit Card FinanceEssential Facts
for Students

• 2005 2006
• Carol A. Carolan, Ph.D.

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Essential Facts Two Groups of Information

• Credit Card Costs
• Credit Card Behaviors

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Credit Card Costs
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• Annual Fees
• Interest
• Annual Percentage Rate (APR)
• Average Daily Balance Method
• Cash Advances
• Convenience Checks
• Penalty Rates

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• Low Interest Teaser Rates
• Balance Transfers
• Late Fees
• Over Credit Limit Fees
• Bounced Check Fees
• Currency Conversion Fees

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Choosing aCredit Card
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Look For

• A Low Annual Percentage Rate (APR)
• No Annual Fee
• A Long Grace Period
• Average Daily Balance Method
• Low Penalty Rates

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Types of Credit Card Users

• Convenience Users
• Revolvers

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Dos and Donts
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• One Card
• Student Loans for Tuition
• Wants vs. Needs
• Convenience
• Pay More Than the MMP
• Be a Manager

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• Dont Skip Payments
• Pay on Time
• Dont Exceed Your Credit Limit
• Cash Advances
• Convenience Checks
• Be Wary of Teaser Rates

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• Credit Card Shuffle
• Low Credit Limit
• Quickly Mail Payments
• Save Receipts
• Change of Address
• Lost and Stolen Cards

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Theres Alwaysa Solution
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Getting Out of Debt

• Dont Deny the Problem
• Stop Using Your Card
• Contact Your Credit Card Issuer
• Get a Job
• Reduce Expenses
• Talk about Your Problems
• Debt Consolidation

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Credit Reports Credit Scores
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Credit Report

• Collection of Information
• Financial Report Card
• Lenders Use this Information
• 3 Main Credit Reporting Agencies
• Regularly Review Your Credit Reports

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Credit Score

• Numeric Value Applied to a Credit Report
• Usually Called a FICO Score
• Higher is Better

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What Goes Into OurCredit Scores?

• Pay Bills on Time
• Unresolved Debt
• Number of Cards and Their Balances
• How Long
• Quest for New Credit

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Consequences of IrresponsibleCredit Card Use
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• High Interest Rates
• Difficulty Renting an Apartment
• Denied Employment
• Graduate School Rejection
• Higher Insurance Premiums
• Big Bucks for Cell Phones

• Denial of Credit

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Identity Theft
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Signs of Identity Theft

• Card/Statement Not Requested
• Statement Not Received
• Unauthorized Charges
• Denied Credit
• Debt Collectors

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Minimize the Risk

• Keep Personal Information Personal
• Dont Use Social Security Number
• Leave Social Security Card Home
• Carry Only Whats Needed
• Photo ID Credit Card
• Know Your Billing Cycles

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• Shred Receipts
• Use the Post Office
• Creative Passwords
• Purchase on Secure Websites
• Keep Personal Information Safe
• Review Credit Reports
• Computer Virus Protection

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Victims of Identity Theft Should

• Contact the Big Three
• Fraud Alert
• Order Free Credit Reports Review
• Call Fraud Departments
• Close Fraudulent Accounts
• File a Police Report
• Contact the FTC

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