Thursday, June 07, 2007

About the Credit Card

Have you got a credit card? I think the answer to most working people is ‘YES’. These days, Credit cards just become a necessary tool in our life, where they can help you book and/or shopping on-line or through the telephone. It does make your life become easier.

The question here is ‘how much you know about your credit card?’ I would assume not much.

For example the term interest free credit cards, are you familiar with? It is a great tool in the right hands meanwhile it could become a trap. When you first hear this term, you would feel pleased because up to 45 days, 55 days, you don’t have to pay any interest on the bill. But have you realised that credit cards start charging a lot after the interest-free period has expired,

Also, do you know why you would have the interest free period and will you join those great reward programs? In finance terms you are creating your own ‘spread’. Put it simply, the reason you can have those is because of those undisciplined credit cardholders who only pay the minimum monthly balance or close to it, the interest they have been charging cover all those great things.

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