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Financial Literacy

Financial Literacy

Home Finance Credit and Debit

Credit and Debit

Credit Cards

Credit cards: we've all seen 'em…but what are they?Credit cards are basically plastic proof that a credit card company like Visa, MasterCard, or another company has extended you an unsecured, tem...

APR

Every time you charge something with plastic and, at the end of the month, don't pay it back in full, you're borrowing money from your credit card company. And since they're not just good Samaritan...

Credit Card Origins

A Short History of Credit CardsIn the 1930s, America sped up. The Ford Model T had a death-defying speed of 40 MPH, and suddenly Americans were whizzing everywhere. (Not that kind of whizzing, weir...

Anatomy of a Credit Card

Your credit card might have a blue background, a snapshot of your favorite vacay spot, or a pic of your pug, Mort. But beyond the design of the card, they're all pretty similar.You're probably look...

How Credit Cards Work

How do credit cards work?It's pretty simple, actually.You find something you like in a store, you whip out the plastic from your wallet, and you hand it over (or in some cases, swipe it yourself)....

Credit Limits

You want to live your life with no limits? Well, if you're carrying plastic in your free-wheeling lifestyle, it ain't gonna happen.Credit limits refer to the maximum amount of money you can charge...

Credit Card Interest

Here's where the rubber meets the road.Credit card companies charge interest if you don't pay your credit card off every month.Let's say that you go to prom and rack up $500 in charges for a prom d...

How Money Flows

Marshall is in Best Buy looking at new cell phones; his current one is on the outs.He finds the one—the newest iPhone, natch—and charges it on his credit card.On the surface, it seems like ther...

Case Study

Sarah is in her first year of college. She has a cool new dorm room, a love of physics, and a roommate who's really into fanfiction. So far, so normal.Sarah gets a ton of credit card offers. Becaus...

Making the Minimum Payment

Minimum Payment = Maximum PainIf you really want to mess up your financial life, paying just the minimum amount of your credit card bill each month is a good place to start.When you get your monthl...

Electronic Payments

To pay her bills, your granny had to put on her Sunday hat and walk to the bank or sit down with her tiny glasses and pocketbook to write out the checks and snail mail them. And if you head into a...

Types of Credit Cards

Credit cards all tend to be about 3" x 2" and are designed to fit into your wallet. But that's where the similarities end. Since credit card companies are always trying to get new customers, they c...

Debit Cards and Prepaid Cards

Debit cards look a lot like credit cards, but they're really banking cards masquerading as plastic. You can use debit cards to withdraw money from your account or to pay for purchases online or at...

PayPal

PayPal is an electronic payment system that you can use to…(1) Buy stuff online. Let's say you decide to buy a new electric guitar on eBay to annoy your roommate. Perfect. eBay uses PayPal almost...

Interest Rates

Interest rates are what banks, credit card companies, and other folks charge to lend you money. You can borrow money, yes, but it'll cost you. Pro tip: pay attention to interest rates.The lower you...

Increasing Interest Rates

You sign up for a credit card with a 15% interest. You feel pretty good about it because you did all your research, compared rates, and even bargained with the credit card company to give you the b...

Loan Interest

Different Levels of Hurt for Different Types of LoansNo matter what you borrow, you'll have to pay. Borrow your brother's shoes, and you might pay with a fist to the stomach. Borrow money from a ba...

Credit Card Usage

Back in the 1950s, credit cards were pretty much limited to Diners Club or store cards. Diners Club—the biggest and only company that let you charge at lots of different places—had only a few h...

What the Facts Mean

There are lots of statistics floating around out there about credit cards and how much we owe on all our plastic. And the numbers are pretty grim: in 2014, Americans owed $882.6 billion in credit c...

Paying Off Credit

In 2014, the average U.S. household owed about $15,611 in credit card debt (source). Yowza.How can someone pay off that debt? Let's say Bob and Janie Smithson have exactly that amount of debt on th...

Banks and Stores

Banks, Stores, and Plastic: What Makes the (Economic) World Go 'RoundIssuing CompaniesFor the companies and banks that issue the cards, the world is their oyster. These financial institutions love...

Paying for College with Credit

Unless your zany Uncle Louis set up a 529 Plan for you when you were in diapers or your daddy made a killing with his maple syrup soda business (or his law firm, if you come from more traditional s...

Understanding Your Credit Card Statement

You pop open your credit card bill and it looks like something out of an accountant's dream. What are all those numbers, dates, and decimal points? Do you really need to read the whole thing?Uh, ye...

Calculating Interest

You have a credit card with an interest rate of 18%. Seems pretty straightforward: 18% is 18%, right? Nope. Unless you’ve been sleeping with your eyes open in every Trig, Calculus, and Statistics...

Credit Reports

You know that permanent record that everyone keeps threatening you about?It's a real thing.Your financial hijinks can end up on your credit report—and that doesn't go away, no matter how much you...

Credit Scores

Your credit score (also known as a FICO score) is a number that tells employers, landlords, and banks how good you are at handling money. Have a score over 800? That probably means you pay your bil...

Fraud and Identity Theft

Each year, millions of Americans are devastated by identity theft and credit card fraud. Here are a few ways it could go down:Your grandma gets a call from a man claiming that her credit card is ov...

Choosing a Credit Card

How Not to Choose Plastic That's Going to Embarrass You at DinnerResponsible Rosanne decides to get a credit card. She's at UCLA and she'll be graduating in a few years with a hefty student loan. S...

The Fine Print

We don't care how precious your 20/20 vision is: reading the fine print is a must. Stock up on eye masks and cucumber slices—we're going in.The ads for a credit card tell you all the stuff that t...

Which Card Should I Get?

How Can You Make the Right Credit Card Decision?Think of getting a credit card a little like popping the Big Question. There's no little velvet box or pricey ring involved with your credit card com...

Applying for a Credit Card

Credit card companies want you to use plastic, so they make applying for a credit card really easy. Even your cat could do it. (Seriously, let him at it.)The hard part is finding the right card for...

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