Online Shopping and Credit Cards Module 8.1 Online Shopping and Credit Cards

Credit Cards One of the primary sources of purchases for most consumers in the country The average American has $10,000 worth of debt, mostly in credit cards A credit card is different from a debit card debit cards remove money from your checking account when a purchase is made with credit cards, you make monthly payments on your balance

Revolving Credit Loans A consumer line of credit that can be used up to a certain limit or paid down at any time You can use the amount for which you’re approved Must be repaid to the credit card issuer If not paid in full at the end of the month, it will accumulate interest on the balance due you can use up to the approved amount as long as you continue making payments (the earlier you pay off, the less interest you’ll pay)

Using Credit Safer than cash When you pay with a credit card, the card company pays the bill for you They send you a statement (bill) at the end of each month showing what you purchased Also shows: fees and minimum payment (least amount you can pay on your balance without getting charged fees) owed Read the FINE PRINT before getting a credit card

Review Statement Credit card companies make mistakes Make sure nobody else is using your card You have the right to dispute charges Explained on the back of the statement Do it in a timely manner They can NOT change interest rates without telling you If there’s a special introductory rate like 0% interest, make sure you read to see when it expires

Credit Card Statement Purchases or new charges – list of what you bought and rate of interest you are paying Payments and credits – how much you have paid on your balance since the last statement Due date or pay-by date – pay BEFORE that date Credit Limit – maximum amount you are allowed to charge. Avoid over-the-limit fees.

Module 8.2 Credit Cards: Shopping Online

Online Shopping Tips (2/3 of people use the internet to shop) Know exactly who you’re dealing with (reputable companies) Know exactly what you’re buying Know the terms of the deal Know exactly how much you will be charged Pay by credit card Print and save records of your online purchases Checks the site’s security (https:// secure) Check the site’s privacy policy

Buying Online Pros Cons Stores never close No parking problems No aggressive salespeople Easy to compare Hard to find products No local sales tax Bargain prices Wait for delivery Delay in receiving products S&H Reliability of sellers? Can’t negotiate prices Can’t see product in person Potential for inferior products