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Credit Cards

Credit Cards -- “Own now, pay later”

How To Get a Credit Card

  • Apply for a credit card from your preferred financial institution, but you can only qualify for a credit card if you have proven income. You must make sure to read the contract and understand all terms and conditions before signing for anything.

    •  If you do not understand your contract, consult an expert.

    • You must then agree to the terms of the credit card contract that you read and understood (interest rates, repayment terms, penalties).

Why Get a Credit Card

  • A useful tool when not misused.

    • Do not buy stuff you cannot pay back, the amount of money you owe grows and you end up paying way more because the company charges interest on the money you use.

    • It should ONLY be used to stall payment to a later date of which you KNOW you will have the money.

    • Until the end of the month, you are in debt to the credit card company.

    • Credit cards have limits, it is the allotted amount of money the credit card company is willing to let you use, this amount depends on many things including your credit score and income.

Pro's and Con's

PROs: Allows for later payment, instant gratification, builds credit score IF paid off regularly, building better credit allows for better loans in the future.

CONs: Large risk of over spending, requires discipline when using in order to not spend more than you can pay off, can risk financial burden.

Credit Card Fraud

  • Charges to your account that you have not made.

    • This can happen when your credit card is physically stolen, or someone uses your social security number to register one under your name. Really this can happen in any way in which someone accesses your information and uses it for money.

    • You fix it by telling the financial institution that it was stolen and they will tell you what to do from there. This is why you balance your checkbooks every month, to catch any suspicious charges.

Credit and Debit Cards: Open Positions

Debit Cards

When you open a checking account at a bank or credit union, you usually receive a debit card. A debit card lets you spend money from your checking account without writing a check. When you pay with a debit card, the money comes out of your checking account immediately.
There is no bill to pay later.

How to Get a Debit Card

  • When you open a checking account they will give you a debit card, some starter checks to use, and a ledger to keep track of your transactions.

  • When you run out of starter checks you just order more through your bank online or in person and they will be mailed to you.


  • Allows people to make non-cash transactions. 

  • An alternative to carrying cash but works exactly the same.

  • It should be tied to your checking account where you will keep your spending money. 

  • No real debt threat but it does not help (or harm) credit like a credit card.



  • If somebody gets hold of your debit card, they take money straight from your account.

  • When money comes straight from your account, it can put you in a really tight pinch until you get those funds back, however, with a credit card, you get a month-long buffer to balance your books. 

  • Think about this: if somebody takes your money and rent is due the very next week, would you be able to cover it? (a savings account comes in handy for this)

  • For these reasons, you should look into if the financial establishment will restore the funds taken, how much if there is a limit, and how long it would take.


Unfortunately, an overall 12% of consumers have reported fraudulent charges on their debit card 
To protect yourself:
Do weekly or daily checks on your accounts to ensure that the charges are correct and written down.
Save your receipts.
Use checks to pay. Using a checkbook allows you to automatically have a written record of what you spent without going back and looking (It is old school but effective)

Credit and Debit Cards: Publications
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