Curious to know a little more about your credit card? Maybe you want some fun facts to impress your friends? Let me share some interesting trivia I found out about your wallet’s cards.
What do the numbers on your card mean? Let’s break this into some basic parts. The first number indicates the credit card company. MasterCard is always a 5, Visa is 4, Discover is a 6 and American Express is 37. The rest of the numbers indicate the bank issuer and the account number, except with American Express who doesn’t use a bank issuer, the rest of their number is simply the account number.
Can you actually pay off your credit balance with just the minimum payment? You would think that your minimum payment should be a number that helps you get out of debt quickly. That is actually not so. The minimum payment actually keeps you in debt and paying the bank interest as long as they can keep you. Unless you are strapped for cash, you should ALWAYS pay more than the minimum payment due on your credit card bills.
Bankrate.com claims there are an estimated 1.2 billion credit cards in circulation in the United States. That is almost an average of six cards per adult. How many cards do you have?
Interest rates on credit cards typically range from 12% to 25% with an average of around 18% to 19%. If you are buying stuff at these rates, you are paying 20% or more than the purchase price. So much for a good deal!
APR, your interest rate, is not a fixed number. Many people falsely believe that this is set in stone. Your credit card company can change the APR with simply a letter of notice. Most likely, in their terms and conditions, they also reserve the right to change it automatically if you miss a payment or go over your limit.
The key with credit cards is to be aware. Pulling out that plastic is too easy. Make sure you really know what you are getting into.
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