Credit Cards and Credit Reports

Personal Finance

Mrs. Brewer

One Person’s Story

Credit Card Traps

• Low Introductory Rate

• Percentage Rate fine print read it…your rates may be subject to change.!

• Late Fees

• Over the Credit Limit Fees

Calculating Monthly Interest

Assumptions

–13.2% APR or 1.1% per month

–New Balance $432.00

–Minimum Monthly Payment $54.00

Calculating Monthly InterestDate Previous

BalanceInterest Charge

Balance Plus Interest

Your Monthly Minimum Payment

Remaining Unpaid Balance

March 23 $432.00 $4.75 $436.75 $54.00 $382.75

Calculating Monthly InterestDate Previous

BalanceInterest Charge

Balance Plus Interest

Your Monthly Minimum Payment

Remaining Unpaid Balance

March 23 $432.00 $4.75 $436.75 $54.00 $382.75

April 23 $382.75 $4.21 $386.96 $54.00 $332.96

Calculating Monthly InterestDate Previous

BalanceInterest Charge

Balance Plus Interest

Your Monthly Minimum Payment

Remaining Unpaid Balance

March 23 $432.00 $4.75 $436.75 $54.00 $382.75

April 23 $382.75 $4.21 $386.96 $54.00 $332.96

May 23 $332.96 $3.66 $336.62 $54.00 $282.62

June 23 $282.62 $3.11 $285.73 $54.00 $231.73

July 23 $231.73 $2.55 $234.28 $54.00 $180.28

August 23 $180.28 $1.98 $182.26 $54.00 $128.26

Sept 23 $128.26 $1.41 $129.67 $54.00 $75.67

October 23 $75.67 $0.83 $76.50 $54.00 $22.50

Nov 23 $22.50 $0.25 $22.75 $54.00 $0.00

Credit Card Calculations

• What was the total interest paid?• $22.75• How much did we actually pay for the

purchases at the end of 9 months by using the credit card?

• $454.75

Credit Card Billing Statement

Credit Reports

• Tricks and Traps

• Really Free Credit Report

What is a Credit Score?

• Range from 300 to 850• Positive and Negative Aspects of Credit• Credit Cards• Car Loans• Home Loans• Student Loans

Categories of the Credit Score

Your Credit Report

Credit Scenarios…