When Credit Cards Attack

1
When Credit Cards Attack!

• Interest on unpaid balance
• 14, 20, 32... or more!
• Penalty fees for late payments

2
Use a Credit Card? No!
Giving consumers the use of a credit card is
similar to giving people the keys to a car
without driving lessons or having a license. If
they are lucky, they'll learn by only having some
fender benders. But millions get into multiple
car accidents that spin out of control and
eventually into bankruptcy.
When someone is carrying any credit card debt,
it means they are falling behind instead of
getting ahead, and that means there's a
problem. When people ask how much credit card
debt is okay, it's a little like asking how much
TNT can you keep in your basement. You probably
could keep some and get along okay. But the
smartest move is not to keep any.
3
Use a Credit Card? No!

• What happens if youre late with your payment?
• Youre hit with late fees.
• Your interest rate can go up immediately.

• What other problems with credit cards are there?
• No limit on how high the interest rate can go.
• Your interest rate can go up anytime with a
  15-day notice.
• Average household credit card debt 9,900.
• Average college student credit card debt 2,200

4
2,200
1,717
Paying just the minimum amount on a 2,220
balance means

• it will take you 15 years to pay it all off

, and

• it will cost you an additional 1,717 in
  interest!

5
Use a Credit Card? Yes!

• Credit cards have some big advantages over debit
  cards
• Liability for card fraud is 50 by law, if
  reported within 60 days.
• With debit card, liability is up to 500, and
  only 2 days!
• You can refuse to pay for unreceived or
  defective goods.
• If a billing error occurs, you dont have to pay
  that amount while its being investigated. With
  a debit card, that money is gone while they
  investigate.
• Reward credit cards are common. Not so for
  debit cards.
• Many credit cards give you extras. Not so for
  debit cards.
• Credit cards, used wisely, build your credit
  score.

6
Use a Credit Card?? Well

• Yes, if you follow these rules
• Pay off the entire balance every month.
• Corollary if you cant afford it, dont buy it.
• Always be on time with your payments.
• and consider these suggestions
• Dont get a card with an annual fee.
• Do get a card with rewards.

Credit cards are the best of products and the
worst of products.
Stephen Brobeck, Consumer Federation of America