What to Know Before You Play the Credit Card Game

If you want to pay for a service or product, you would consider whether to use a credit card to charge the item or service or use your cash-generated debit card. A debit card is different from a credit card, even though, both of them can be used to make payments on products and services. If you don’t have enough money in your bank account, leave your debit card at home. If you are in the market looking for a credit card, it is best to make a comparison on the different fees, perks, finance charges and interest rates offered.

               

The Fine Print

Credit cards are used to shop for desired items and then you pay for the items through submission of monthly payments to the creditors for the remaining balance. Some credit card companies will ask you to pay an annual fee to use their cards. Some credit card companies will provide consumers with a courtesy check to use at their convenience, in place of the credit card. Not because you got the check should you think that it is free. It carries the same responsibility as the credit card itself. If you are unable to pay your credit card bill in a timely manner or pay the entire balance on or before the due date, you will be assessed finance charges. The finance charges goes up and down according to the balance that you have outstanding and the APR.

Charge Cards

American Express usually offers a reasonable credit card limit. However, they, unlike other credit card companies ask that you pay off the entire balance once you receive your monthly statement. Therefore, if you know that your rent is due on the same day when the charge card payment is used, it is best not to use your card.

Debit Cards

Your debit card allows you to buy items. In real time, you get to access your money from the bank electronically. If there is no money or little funds in your bank account, the debit card is the story teller. Your debit card will be declined for lack of funds in that situation. Your debit card is the ideal method of purchase since you wouldn’t try to buy something without knowing whether there is enough money in the bank account or not.

Reading the Fine Print

If you are submitting an application for a credit card, it is essential that you shop around. Find out what the interest rate is and if there are any associated fees that you should be aware of. That is why it is important to read the fine print. Check to see if there are any disclosures. Pay attention to the APR or annual interest rate as it will be the measurement needed to check how much the use of the credit card cost you. Before you take responsibility for a credit card, get as much information about the card as you can. Find out about the grace period policy and if there are any yearly fees or transaction fees attached to the use of the card. In any event, it is important play the credit card game responsibly at all times.

 

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