2.4.1.g1 © family economics & financial education – december 2005 – get ready to take...
TRANSCRIPT
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Take Charge of Credit Cards
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
What is a Credit Card?
• Pre-approved credit Credit- When a financial institution lends
an individual money and trusts he or she will pay it back
• Used to purchase items now and pay for them later
• The word credit comes from the Latin word “Credo” meaning “I believe.”
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Credit Card Terms
• Interest- Fee for borrowed money• Credit Line – Maximum amount of money
that can be charged to a credit card• Annual Percentage Rate- Interest rate
charged to the cardholder on the amount borrowed
• Finance Charge – Possible charges assessed to an account for credit card use
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Credit Card Terms Continued
• Annual Fees - Fee charged once per year for credit card ownership
• Minimum Payment – Minimum payment of a credit card bill that must be paid
• Due Date – Date payment is due• Late Payment Fee - Fee charged
when a cardholder does not make the minimum monthly payment by the due date
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Advantages
Convenient Useful for emergencies Often required to hold a
reservation Purchase expensive items
earlier Eliminate the need to carry
around large amounts of cash
Brainstorm 3 advantages of using a credit card
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Disadvantages
Paying interest Additional fees are common Tempting to overspend Responsible for lost/stolen
cards Identity theft is easier Can cause large amounts of
debt
Brainstorm 3 disadvantages of using a credit card
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Safety Tips
• Shred any unwanted credit card offers or credit cards received in the mail
• Always check your credit card statement to make sure there are no false purchases
• Sign card with signature and “Please See ID”
• Do not leave cards lying around• Close unused accounts in writing and
by phone, then cut up the card
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Safety Tips continued
• Do not give out account number unless making secure purchases
• Keep a list of all cards, their account numbers, and phone numbers separate from cards
• Report lost or stolen cards promptly
2.4.1.G1
© Family Economics & Financial Education – December 2005 – Get Ready to Take Charge of Your Finances – Take Charge of Credit CardsFunded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Remember….
• Only use a credit card when there is no doubt about ability to pay off the charges at the end of the month