Like most Americans, you probably have at least one credit card if not more. Each time you approach the cash register, you may find yourself reaching in your wallet for that slab of plastic. You might even call it a reflex. In this day and age, credit has become a normality in our daily lives. Practically every store accepts credit cards and many vendors prefer credit cards over personal checks.
Banking online has never been easier with instantaneous pending transactions available just seconds after your card is swiped. However, charging through credit is not all fun and games, especially when it’s due date time. Many fall into the trap of only making the minimum payment each month, falling into even deeper debt.
One problem eager spenders face is signing up for a credit card they feel has low rates and three months down the road, are hindered by rising APR percentages. What exactly is an APR percentage? Believe it or not, some people get into credit card debt because they don’t understand the basics of credit card lingo.
Make Sure You're Aware of the Following before you fill out that credit card application:
- APR: Annual Percentage Rate or the rate of interest you’ll have to pay if you have a balance carryover, transfer balances from another card or take out a cash advance.
- There are such things as penalty APR’s, where your percentage increases if you make late payments.
- Introductory APR’s-Your APR percentage rate is bound to rise after a select introductory time span.
- Tiered APR's-Depending on amount spent, different percentages will be applied.
- What is a grace period? The amount of time you have to fully pay your bill without being charged.
- Minimum finance charges - If you spend less than the minimum finance charge, you will be charged the minimum amount required.
- Annual fee-Some cards charge you monthly; Some quarterly or yearly-This is a fee just for holding that credit card.
Some credit card companies offer fixed APR credit cards, or cards whose percentages don't change. If they do change, the company is required to notify their customers before making the switch. Cards that have variable rates can change at times, so cardholders should monitor their percentages.
StarReviews reported that one fixed APR card, Pulaski Bank Gold Visa, even offers cardholders special incentives such as free auto rental & travel insurance, as well as free emergency services. Those who like stability and who may not have the best credit history may want to choose from one of several options of fixed APR credit cards.