Credit Card Debt
Use a credit card to buy stuff. Don’t pay off the balance before the end of the grace period.
Voila. Now you have credit card debt.
Credit cards are convenient and can bring a lot of benefits (airline miles, cash back, Disney dollars, etc.). But they also come with high interest rates...more than 20% in most cases. Just pay the minimum payment, and it will take seemingly forever to pay off the balance. Assuming you aren’t adding to it each month, in which case it might take literally forever.
Bottom line: be wary of credit card debit.
And for much more on this hugely important topic, see our page on Credit Cards for the full Shmoop.
Related or Semi-related Video
Finance: What is the Equal Credit Opport...6 Views
Finance a la shmoop what is the Equal Credit Opportunity Act? alright people while the
federal government thinks everyone should have the equal opportunity to get [Men in Federal Government appear]
into debt isn't that sweet of them you know that Uncle Sam well he sure does
have a heart of gold this federal law makes it illegal to discriminate against
people who are applying for financing on pretty much anything legal based on
their age gender marital status religious affiliation ethnic or national
background or public assistance benefits your credit score however well that
still matters sorry just keeping it real
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