1. ITS OK TO HAVE A CREDIT CARD….BUT! Michael Servé Assistant Vice President for Finance & Budget LBJ-2243 michael.serve@rit.edu October 26, 2012

2. Program Credit Abuse Resistance Education Program2 Responsible spending. Saving and budgeting. Understand the details about credit.

3. Wants vs Needs Credit Abuse Resistance Education Program3 3

4. Consumerism Credit Abuse Resistance Education Program4 Buying Goods & Service

5. Consumerism – Good or Bad? Credit Abuse Resistance Education Program5

6. Responsible Consumption Credit Abuse Resistance Education Program6 You can buy more if you spend less! Set a budget and stick to it. Learn to save to buy a house or a car.

7. Pay Now Credit Abuse Resistance Education Program7 Pay cash for wants. Write a check. Use debit cards. –Debit cards take the money right from your checking account.

8. Have $$ in Your Account! ATM usage fees. Overdraft charges. If you bounce a check, your bank may put your name in Chex Systems SM and harm your credit. Credit Abuse Resistance Education Program8

9. For Big Ticket Items Unless youve saved lots of cash… Credit Abuse Resistance Education Program9 …youll probably use a credit card.

10. True or False? If you pay your credit card balance on time and in full each month, it doesnt matter what rate the bank charges on your credit card. Credit Abuse Resistance Education Program10

11. TRUE Because you pay interest on the unpaid amount each month, you never pay any interest charge if you pay the entire amount due each month. Credit Abuse Resistance Education Program11 Banks hate it when you do this!

12. Annual Percentage Rate Different banks charge different APR rates. Shop for a credit card with the best terms that suit you. – Pay close attention to various late fees and penalties Credit Abuse Resistance Education Program12 ANNUAL MEMBERSHIP FEE: Refer to your statement in the month in which the fee is billed. RENEWING YOUR ACCOUNT: You may have your annual membership fee credited to your account if you close your account within 30 days from the mailing or delivery date of the statement containing the fee, even if you use your card during that period. You may call the Customer Service number or write to the Customer Service address on your statement during this 30 day period and your account will be terminated; we will credit your account for the amount of the annual fee. ANNUAL PERCENTAGE RATE: Refer to the Rate Summary section of this statement. Your periodic rates and APRs may vary. RATE AND ACCOUNT SUMMARIES: The purchase and advance features of this account may be listed in the Rate Summary Section of this statement under the following titles: Standard Purch, Purch/Adv, Standard Adv, and various numbered Offers. The Account Summary section of this statement includes on the PURCHASES line subtotals for all purchase features, and on the ADVANCES line subtotals for all advance features, of the Previous Balance, new Purchases & Advances, Payments & Credits, FINANCE CHARGE and New Balance amounts. PERIODIC RATES: (D) and (F) indicate a daily periodic rate. (M) indicates a monthly periodic rate. FINE PRINT!

13. Can Students Get a Credit Card? A credit card CANNOT be issued to someone under age 21 unless the person has a co-signor (over age 21) or can provide proof of a means to repay. Before the change in the law, the average college student owed about $3,000 in credit card debt. Credit Abuse Resistance Education Program13

14. Credit Card Promises & Tricks Credit Abuse Resistance Education Program14 Promise 1: As low as 9.99% APR! Promise 2: Up to 5% cash back! Promise 3: Your card has a credit limit of $3,000.

15. Credit Card Tips Credit Abuse Resistance Education Program15 Get only one credit card. Avoid new accounts just for the low introductory rate. Put a cap on your credit limit. Dont max it out. No cash advances. Dont let anyone else use your card! Try applying for a secured credit card if you cannot get credit.

16. Pay Up! Calculate how long it will take to pay off credit cards. Visit Bankrate.comBankrate.com Make a plan to pay debt and stick to your plan. Try to pay the entire amount due each month by the due date. Pay more than just the minimum payment amount. Pay higher-interest cards first, but dont miss any payments on any card. Credit Abuse Resistance Education Program16

17. Worth the Cost? Before you buy something on credit, answer these questions: How much the purchase will really cost you? Can you actually afford the purchase? Is it better to wait and pay in cash? Credit Abuse Resistance Education Program17

18. Credit Cards Cost of Paying the Minimum Card Balance$2,000 Interest Rate 18% Minimum Payment 4%

19. Credit Cards Cost of Paying the Minimum How Long Will It Take to Pay Off ?

20. 8 Years Credit Cards Cost of Paying the Minimum

21. How Much Interest Paid? Credit Cards Cost of Paying the Minimum

22. $1,073.60 Credit Cards Cost of Paying the Minimum

23. Your $2,000 Purchase Cost $3,073.60 Credit Cards Cost of Paying the Minimum

24. Paying Late If you are late in making a credit card payment, your credit report and score will be negatively impacted. The interest rate you pay may increase sharply! And late fees may be added!! Credit Abuse Resistance Education Program24

25. Your Credit Report Card Credit reports exist only for people who have established a credit history. Credit Abuse Resistance Education Program25 Having no credit history may not be a good thing.

26. Good Credit History Auto loan lenders Landlords Buying a house Credit Abuse Resistance Education Program26

27. True or False? Prospective employers may request credit reports from a prospective employee. Credit Abuse Resistance Education Program27

28. False The Employment Credit Check Law (2012) prohibits employers from requesting credit reports unless they are working or seeking work in a financial institution, law enforcement or the Justice Department. Credit Abuse Resistance Education Program28

29. Credit Report Card 3 credit-reporting agencies Visit AnnualCreditReport.com for a free copy of your credit report. 80% of credit reports contain mistakes! Credit Abuse Resistance Education Program29 TransUnion EquifaxExperian

30. Your Credit (FICO) Score A 3-digit number between 300 & 850. – The higher, the better! FICO scores are not part of your credit report. You may have to pay a fee. – To obtain your scores, visit www.myfico.comwww.myfico.com Credit Abuse Resistance Education Program30

31. Credit Abuse Resistance Education Program31 http://care4yourfuture.org/