Vocab
A plastic card that holds pre-approved credit which can be used for the purchase of items now and payment of them later.
What is a credit card?
Why should you not want a credit card?
Credit costs money Its easy to over spend It it ties up future income It can destroy your credit rating
This functions much like a credit card at the store, but the money comes directly from the individual's bank account
What is a debit card?
What can a credit card pay for?
virtually anything goods services
True/False-it is good to be a co-signer on a credit card
False
The cost of credit expressed as a yearly percentage.
What is Annual Percentage Rate (APR)?
Why should you want to have a credit card?
Necessary for Emergencies Making Hotel Reservations Renting A Car Develop A Credit History Convenience While Shopping Enjoy Goods and Services Now, Pay Later Take Advantage of Rewards
If you receive money to buy goods or services now with the promise to pay for them later, you have used this.
What is credit?
True/False Paying the minimum payment is the best way to pay for credit card debt
False
This is why people use credit.
What is to be able to buy and enjoy a good or service now rather than later?
what the banks can take back if you dont pay.
What is Collateral
What are the four major credit cards?
Visa MasterCard Discover American Express
The maximum amount of goods and services a person can place on one's line of credit.
What is a credit limit?
The charge for the privilege of borrowing money, typically expressed as annual percentage rate.
What is Interest?
What are some disadvantages of using a credit card?
paying interest if balance is kept on card additional fees may apply if card is not used properly tempting to overspend responsible for lost/stolen cards risk of identity theft
Crime in which someone wrongfully obtains and uses another persons personal data in some way that involves fraud or deception typically for economic gain.
What is Identity Theft
What should you watch out for when having a credit card.
double cyle billing high limit cards late payment fees
The amount of money originally borrowed in a loan.
What is principal?
What type of loan is a credit card?
short term loan
This is an example of a durable good
What are such things as cars, houses, and appliances?
The largest installment debt in the United States comes from what people owe on this durable good.
What is home mortgages?
What are the 5 C's of credit?
character capacity capital collateral credit history
When a person is legally declared to be unable to pay off debts owed with available income.
What is bankruptcy?
When a card holder only pays the minimum balance every month what will they gain a lot of?
lots of interest and make slow progrerss toward paying off what is owed on the credit card
A financial institution owned and operated by its members, providing savings accounts and low-interest loans to its members.
What are credit unions?