Understanding Credit Card Basics

The video provides insights into applying for a new credit card, highlighting key considerations such as annual fees, interest rates, penalty fees, grace periods, and billing cycles. The presenter shares personal news about receiving a fifth credit card and offers advice on maintaining a good credit score. Viewers are encouraged to use resources like Credit Karma for personalized credit card recommendations.

What was the personal news shared by the narrator at the beginning of the video?

• Bought a new house

• Started a new business

• Got approved for a fifth credit card

• Received a new job offer

Why should beginners avoid credit cards with annual fees?

• They are harder to get approved for

• They offer fewer rewards

• There are many no-fee options available

• They have higher interest rates

What is the average interest rate in the U.S. as of January 2016?

• 20.25%

• 25.5%

• 10.5%

• 15.12%

For someone with good to excellent credit, what interest rate range can they expect?

• 5-10%

• 12-15%

• 18-20%

• 25-30%

What happens if you make a late payment on your credit card?

• You are charged a late fee and higher interest rate

• You receive a reward

• Your credit score improves

• Your credit limit increases

What is the typical grace period for credit card payments?

• 30 days

• 15 days

• 25 days

• 10 days

Why is it important to know the grace period of a credit card?

• To avoid annual fees

• To increase credit limit

• To maximize reward points

• To make interest-free payments on time

What type of billing cycle is most beneficial for consumers?

• Annual billing

• Single cycle billing

• Two-cycle billing

• Quarterly billing

What is the disadvantage of two-cycle billing?

• It reduces the credit limit

• It offers fewer rewards

• It increases the average daily balance and interest

• It has a shorter grace period

What tool does the narrator suggest for personalized credit card recommendations?

• Credit Karma

• Mint

• NerdWallet

• Experian