Credit Cards

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What is a credit card?

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A credit card is a financial tool that allows individuals to borrow money from a bank or financial institution to make purchases, with the agreement to pay back the borrowed amount, usually with interest.

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What is a debit card?

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A debit card is a payment card that is linked directly to a checking account, allowing users to spend money they have in the account.

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What does APR stand for?

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APR stands for Annual Percentage Rate, which is the annual rate charged for borrowing or earned through an investment.

Tags

CCSS.7.RP.A.3

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What is the difference between a credit card and a debit card?

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A credit card allows you to borrow money up to a certain limit, while a debit card allows you to spend only what you have in your bank account.

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What is a co-signer?

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A co-signer is a person who agrees to take responsibility for a loan if the primary borrower fails to make payments.

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What is the purpose of building credit?

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Building credit is important for obtaining loans, mortgages, and favorable interest rates in the future.

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What is a credit limit?

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A credit limit is the maximum amount of credit that a financial institution extends to a borrower on a credit card.

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What is interest?

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Interest is the cost of borrowing money, usually expressed as a percentage of the amount borrowed.

Tags

CCSS.7.RP.A.3

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What happens if you miss a credit card payment?

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Missing a credit card payment can result in late fees, increased interest rates, and a negative impact on your credit score.

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What is a credit score?

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A credit score is a numerical representation of a person's creditworthiness, based on their credit history.