Provided by Elan Financial Services
YOUR FIRST CREDIT CARD IS A RITE OF PASSAGE.
This may be the first time in your life you’re being entrusted with a credit line, which means you can spend money you probably haven’t earned yet. Using your card responsibly shows you know how to manage money and puts you on the road to building a solid credit history.1
CREDIT CARDS 101
A credit card is basically a loan from your financial institution. They assign you a predetermined credit limit, and you can pay back whatever you charge either in full or in monthly installments. If you don’t pay back the entire amount owed each month, you will owe interest on the outstanding amount and any new purchases. For Balance Transfers and Cash Advances, interest begins accruing from the date of the transaction.
Credit cards offer the convenience of being able to buy what you need now with the security of not having to carry cash. You also receive fraud protection, and in some cases, rewards for making purchases.
With these advantages also come responsibilities. You need to manage credit cards wisely by understanding all of the card’s terms and conditions; paying on time; and realizing the true cost of purchases and transactions made with credit.
UNDERSTANDING YOUR CREDIT SCORE
In the simplest terms, a credit score is a number that helps financial institutions predict how likely you are to repay your debt. The higher the number, the better the score, which indicates a strong credit history.
Credit scores are based on credit history and things like race, religion, national origin, gender, age, education, or marital status are prohibited from factoring into a credit decision.
Your credit score is fluid. Every time you apply for, use, make, or miss a payment on a loan or credit card, you build another entry on your credit report — and raise or lower your credit score. The best way to have an excellent credit score is to start out doing everything right and keep it that way. Here are some good guidelines:
Before you open a credit card, make sure you understand these basic credit card terms:
Once you do find a credit card that is right for you, practice good financial habits.
Make sure you pay on time, don’t go over your credit limit, and don’t spend more than you can afford to repay. Some credit card issuers offer personalized and automatic alert messages, sent to you via email or text message2 to help you keep track of:
Understand your rights as a credit cardholder.
You’re entitled to protection:
1 Late payments or going over the credit limit may damage your credit
2 Standard messaging charges apply through your mobile carrier and message frequency depends on account settings.
3 Elan Financial Services provides zero fraud liability for unauthorized Cardmember must notify Elan Financial Services promptly of any unauthorized use. Certain conditions and limitations may apply.
Learn more about Provident Bank’s credit card options here.