What is a Credit Card?

Credit cards
Allow you to make purchases and pay for them later by using a line of credit extended by a bank. Interest is charged based on the terms of your Card Agreement. Credit cards provide extra protection against fraud. If your credit card is lost or stolen, report the loss/theft to your issuer. Your liability is contained and no one has access to your checking or savings account information. Also, having a credit card in your own name is an important first step in building a good credit history, an asset for life after graduation.

Finding the right card for you
Choosing the best card for you depends on how you plan on using it and which benefits are the most important for you.
Credit cards come with a wide array of rates, benefits and features. When shopping for a credit card, here are some things to consider:
Does it offer the best rate? Is there an annual fee?
Does it meet my spending needs?
Is it the right type of card for me?
Am I getting something back for spending on the card, such as cash-back or rewards?
Is the card widely accepted?
What features, services and security options are available?
Any good credit card should come with tools to help you manage your spending. E-mail/text message alerts, automatic bill payment and due date options are just some of the features available.

Keep your credit from crashing and burning
After you've decided on the type of credit you need, follow these steps for maintaining a good credit history:
1. Don't charge what you can't afford-even if it looks really good on you.
2. Pay bills on time and build a good credit history. Pay bills late and you'll incur something worse than the embarrassment of walking into the wrong class-a late charge.
3. Set a monthly spending limit and stick to it.
4. Shop around for the best credit card terms and find the card that meets your needs best.
5. Don't let the terms of a Card Agreement sneak up on you like a pop quiz. Understand them completely when you accept a credit card.
6. Save money each payday for emergencies. That doesn't mean late-night pizza cravings.
7. Shop as carefully with a credit card as you do with cash.
8. If you charge day-to-day expenses, pay them in full each month. You don't want to be paying interest charges on a bag of chips.
9. Keep credit card information (including the phone number of the issuer) in a safe place in case your cards are lost or stolen.
10. Keep copies of sales slips and compare charges when statements arrive. If there's a mistake, call your issuer right away. Unlike wrong answers on exams, these mistakes can be changed.
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