Credit cards have become a standard part of most people’s lives. However, if you’re applying for a credit card for the first time, it can be a bit intimidating. Understanding a few of the most typical credit card terms can help make the process go more smoothly.
Annual fee: An administrative fee that a credit card issuer may charge your account each year.
Annual Percentage Rate (APR): The yearly cost of a loan to the borrower. It’s similar to the interest rate. However, it also includes other charges and fees so as to reflect the total cost of the loan.
Credit card: Any card used to borrow money or buy goods and services on credit.
Credit limit: The maximum amount that can be charged on an account at any given time. If your card has a $10,000 limit, you cannot charge more than $10,000 on it.
There are many different credit cards on the market to choose from. Take time to find the one that’s right for you. And remember, owning a credit card is a serious responsibility. Get a card that has a credit limit you can afford. And remember to use it wisely so you won’t get trapped by credit card debt.