How Credit Cards Work and What to Know

Aren’t credit cards bad?

Don’t they trap people in a ton of debt?

Not quite.

Credit cards are a tool.

When used the right way, they can help you build wealth. If used irresponsibly, they can trap folks in a cycle of debt that’s very difficult to break. Check this site http://xn—-ymca3ca4fraek.com

Let’s go through them, top to bottom.

Credit Card Terminology

Here’s a quick list of some of the most common terms.

Annual Fee

Some, but not all, credit cards come with an annual fee. This is exactly what it sounds like. You pay a yearly fee just for having the card. Usually, the fee is waived for the first year that you have the card. The fees range from $30 to $500 per year. Visit this site usfinancer.com

Annual Percentage Rage

You’ll usually see this abbreviated as APR. This is the interest rate you pay on the purchases you make. You can avoid paying interest if you pay off your full credit card balance each month.

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