Tag: credit cards
Interest rates are among the leading causes of snowballing credit card debt, which is absurd considering interest charges can be avoided entirely. To become a savvy credit card user, here’s what you ought to know about the annual percentage rate (APR) attached to your account.
Before signing up for your first credit card, you should take the time to educate yourself on the basics. Understanding the terms and conditions of your credit card, how debt and credit usage affects your financial security, and the overall pros and cons will help you make wiser decisions when it comes to swiping that plastic.
As your credit score improves and your salary increases, credit card companies may reach out and extend your credit limit – and sometimes they even offer high available limits to those who couldn’t possibly afford them. However, you shouldn’t allow yourself to be tempted by ever increasing credit card limits. Remember, that money isn’t yours and you eventually have to pay it back.
Americans rely on credit cards a lot. Total US credit card debt amounts to $784 billion, while the average household carries $17,000 in combined balances. Given the median annual income for US households is about $59,000, the average individual credit card debt amounts to nearly one-third of annual earnings.