HOW DO I OBTAIN A CREDIT CARD?

MANAGING MY FIRST CREDIT CARD

WHAT ARE THE BENEFITS AND RISKS ASSOCIATED WITH

YOUR CREDIT CARD?

HOW DO I OBTAIN A CREDIT CARD?

DID YOU KNOW?

Most credit card companies require that the primary account holder

be at least 18 years of age.

Having a credit card means that a financial institution is lending you money. You must

contact the financial institution to obtain credit. Certain merchants also offer credit cards

(department stores, for example).

In all cases, you must fill out and submit an application form (on-line or in writing).

BENEFITS

• Can have a positive impact on your credit record if you pay your bills on time.

• Handy for making on-line purchases or reservations.

• Often accepted around the world.

RISKS

• Can have a negative impact on your credit record if you pay your bills late.

• Might get you to spend more than you planned.

• Can be expensive if you spread out your payments.

WILL YOUR CREDIT APPLICATION BE APPROVED?

Is your credit application complete and correctly filled out?

Do you have a good client record with the financial institution where you are applying?

Is your credit file up to date and free of errors?

1 Check the interest rates; department store rates tend to be high.

2 See if there are any annual fees.

3 Some cards offer lower rates to students.

4 Cards may come with rewards programs.*

5 If you’re offered credit card insurance, check how much it costs and whether you really need it.

* Accumulating rewards is great, but it’s not worth it if you have to pay high interest on your card balance!

SHOP AROUND FOR YOUR CREDIT CARD TO GET THE

BEST RATES AND BENEFITS!

HOW DOES YOUR CREDIT CARD WORK?

HOW TO PAY YOUR BILL

Each purchase made using your credit card is charged to your account. You must make a payment before the due date shown on your statement. If you don’t, it can affect your credit record.

You have 21 days to pay for new purchases on your credit card. You have to make a payment by the due date shown on your statement.

Find out how long it takes to transfer payments from your financial institution to the credit card company.

• If your payment was not received on time, your credit record could be affected.

• If you don’t pay the full balance on your card, you’ll have to pay interest on the full amount of your purchases!

Transaction date Description Amount

2018-02-10 Gas $50.00

2018-02-13 Groceries $125.78

2018-02-17 Electronics $1,250.78

Total: $1,426.56

YOUR CREDIT FILE AND YOUR RESPONSIBILITIES

HOW SHOULD YOU MANAGE YOUR CARD?

Select the best answer.

Do you have a cell phone? A bank account? Then you probably already have a credit file at a credit reporting agency.

Your file contains all your payment and credit-usage habits. The information is generally kept for seven years. This is your financial report card!

If you have a bad credit record (late payments, non-payments), you’ll have difficulty getting any form of loan or credit (car, line of credit or credit card). You may also have a hard time finding housing or even a job.

It’s important to maintain a good credit record and meet your payment due dates.

You can order your credit report by mail free of charge by contacting

Equifax or TransUnion.

By making sure you pay your credit card

bill in full before the due date.

By at least making

the minimum payment each

month.

By not reaching your credit

limit.

By paying the full balance as often

as possible.

A B

DC

Best answer: A

CHOOSE YOUR LIMIT

WILL YOU PAY INTEREST?

Your credit limit is the maximum amount you can charge to your credit card.

Choose or agree to a credit limit you’re comfortable with and will be able to pay.

You pay the full balance on your card before March 5, 2018.

You won’t pay any interest.

You pay $75 on your card balance before March 5, 2018.

You’ll pay interest on $800 as of the date of the purchase.

You pay $680 before March 5, 2018.

You’ll pay interest on $800 as of the date of the purchase.

Your balance: $800 Payment due date: March 5, 2018

Minimum payment: $40.00 Your credit limit: $1,500

Interest rate: 19%

Transactions

2018-02-10 Computers Inc. $800

RECOGNIZE THE WARNING SIGNSDoes this sound familiar?

You spend on impulse.You receive past

due notices.

You have trouble paying the minimum balance

on your card.

You don’t know how you’re going to pay

your debts.

You transfer your debts from one credit card to another.

IF SO,consult an Association coopérative d’économie familiale (ACEF)

or a Service budgétaire populaire.

YOU PAY THE FULL BALANCE WHEN YOU RECEIVE THE BILL

YOU PAY $50 EACH MONTH

YOU PAY THE MINIMUM (5% OF THE BALANCE)

PAYMENT PERIOD

21 DAYS MAXIMUM

1 YEAR, 7 MONTHS

5 YEARS, 5 MONTHS

TOTAL COST $800 $929.97 $1,120.43

Cost: $800 Interest rate: 19%Visit Tesaffaires.com to do other calculations.

EXAMPLE: PURCHASE OF A LAPTOP

www.tesaffaires.comwww.lautorite.qc.ca

Contact the AMF Information Centre at

1 877 525-0337

QUESTIONS?