take charge of credit cards - get the ccps...
TRANSCRIPT
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Take Charge of Credit Cards
Introductory Level
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
What have you heard?
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
What do you
want to know?
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
What is Interest?Interest is the price of money
When referring to credit, interest is the chargefor borrowing money
The average balance
per open credit card
is $1,157
Interest cancause stress
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
U.S. credit card debt is
$880.5 Billion
July 2014, Nerdwallet
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
U.S. households that
have credit card debt
owed an
average of $15,799
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded 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?
Plastic card that holds pre-approved credit
Credit Limit- maximum amount of money that can be charged on the card
Purchase items now
Pay later
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
34% of Americans
reported paying only the
minimum credit card
payment
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Credit Card Payments
Minimum Payment- minimum amount of a credit card bill
that must be paid every month
Pay total amount owed OR
Make smaller payments- equal or
unequal
What do you think is the best payment option?
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
The average value per
credit card transaction is
$76 for consumers
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
10%
APR 15%
APR
Credit Card Interest
Why would someone choose a card with an APR of 10%
instead of 15%?
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Melissa
Paid full amount owed
$500
Took 1 month to pay off
Paid $0 in interest
Total Paid $500
Skylar
Paid minimum due $50
Took 3 years to pay off
Paid $104 in interest
Total Paid $604
What would you do with an extra $104?
Melissa and Skylar each purchased a plane ticket for $500 using their credit cards
that charge 15% APR
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Debit vs. Credit Card
Debit Card - plastic card that is
electronically connected to an
account that holds cardholder’s money
Credit Card Debit Card
Connected to an account that holds
cardholder’s money
Money is immediately taken out of an account
Not connected to an account
Money is borrowed and paid
back later
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
How do you get a credit card?
1.
2.
Examine credit card offers
Complete an application
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Getting a Credit Card
Must be 21
If someone agrees to be a co-signer on an account, they are equally responsible for the loan
UNLESS
Show proof of sufficient income
Have a co-signer
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
• Convenient• Useful for emergencies• Often required to hold a
reservation• Purchase expensive items
earlier• Possibility of receiving
bonuses, such as frequent flyer miles and cash rebates
• 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
Advantages Disadvantages
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Do Don’t• Pay amount charged in full
every month• Pay payments on time• Keep track of charges by
keeping receipts• Check monthly credit card
statement for errors
• Make late payments• Pay only the minimum
payment due• Go over the credit limit• Charge items that can’t be
paid off within the month
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Irresponsible use of Credit Cards
Charged when minimum payment is not made by due date
Late Payment Fee
Over-the-Limit Fee
Penalty APR
• Charged if the amount of transactions goes over credit limit
• Higher interest rate charged on new transactions
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Purpose
Includes
Why is it important to examine a credit card statement?
• Summarizes important information from previous month
• Transactions made• Amount owed • Minimum payment• Payment due date (date minimum payment is due)
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Credit Card Safety Tips
It is important to keep credit cards and keep credit card information secure to avoid someone else making charges
If a credit card is closed, notify the company in writing and by phone, then cut up the card
Sign back of card with signature and “Please See
I.D.”
Never give out a card number unless making
purchases
Do not leave cards lying around
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Credit Card Safety Tips
Immediately reporting a lost or stolen credit card reduces the cardholder’s liability for any possible fraudulent purchases
Lost or stolen cards should be reported immediately to the
credit card company
Keep a list of all cards, account numbers, and
phone numbers separate from cards
Shred any credit card offers received
Check credit card statements for false
charges; report any false charges immediately
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Summary
What is a credit card?
How can you avoid paying interest on a credit card?
What is the difference between a credit card and a debit card?
• Plastic card that holds pre-approved credit • Used for the purchase of items now and payment of them later
• Pay the credit card balance in full every month!
• Debit card- money is taken from the cardholder’s account• Credit card- money is borrowed and paid back later
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© Take Charge Today – November 2014 – Take Charge of Credit Cards – Slide ‹#›
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
Remember….
If a credit card is used properly it can offer
many benefits
Keep your credit cards and credit card
information secure
Use a credit card responsibly! Only charge items when there is no doubt about ability to
pay off the charges
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