swigg-grl guide to credit

If you just have to have those sheepskin boots or the hottest cell phone, what’s the one thing you need most?

If you guessed “cash,” you’re right! But if this is in short supply, or if the “Bank of Parents” is no longer accepting your requests, you may have another option: credit cards.

A credit card can be a great alternative, but it all depends on how well you understand credit and how responsible you are about using it. Big point to keep in mind: credit isn’t free money – you always have to pay it back….

Here’s a few quick facts on credit:
If you’re under 18, you’ll be on your parents’ card or they’ll be co-signing. Work out an agreement with them about spending limit and repayment arrangements.
Credit cards help you get what you want now – but at a price. If you don’t pay IN FULL by the due date, you’ll have to pay interest. And that means you’re actually paying way more for your purchases than you thought.
Treat a credit card like cash and keep it (and your PIN) safe. Check receipts against the statement then shred them.
A credit card can help you build a “credit rating” (a scorecard that can help you borrow money later) – or it can help you wreck your credit rating. Always pay at least the minimum balance by the due date. Best thing to do? Pay it all off each and every time.
A “pre-paid card” can be a convenient alternative, but often comes with lots of extra fees.

Be smart about credit:

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