Although the use of credit cards is widespread, it is not uncommon to find users who have never used them. “I do not want to pay interest” or “I am not interested in postponing my purchases” are some of the reasons given for it.
what is a credit card?
These small plastics allow us to perform numerous day-to-day operations, such as taking money from ATMs, paying at stores – whether physical or online – or even financing an unforeseen expense.
The main feature of the credit card, and that in turn the difference from the debit card, is that you can make payments or get money at the cashier without having to have that amount in the account at the same time.
Paying everything at once
If we have those $ 1,000 in our account, we can pay off all the debt in the same payment. The entity will pass the charge to the associated account and we will see our balance reduced by $ 1,000.
In this method of payment, the client does not have to pay interest or commissions since he is paying all his debt on the fixed date.
If the amount to be paid is an effort or we simply prefer to pay it comfortably in several months, we negotiate with the bank in how many monthly payments we want to settle the amount financed.
To set the monthly payment, a fixed amount or a percentage of the total amount is established. Normally, the bank sets a minimum amount, which will be the greater of the two.
If I have spent 600 dollars and I want to defer the debt to 10% and my entity stipulates a minimum of 80 dollars per month, the amount to be paid will be those 80 dollars, not the 60 dollars that I would have liked, since it is less That the minimum authorized payment.
We must bear in mind that if we choose this form of payment we will have to pay monthly not only the acquired debt but also the interest corresponding to said debt.
Credit cards are associated with a checking account, normally.
In this type of plastics, the main thing is to search and compare the interest rates charged by the different entities when financing a purchase. The charge is usually monthly and the rate is expressed in terms of APR. If we do not have a payroll, in many cases the interest rate is more expensive and can exceed 20%.
As for the most frequent commissions of these cards are the annual fee, the renewal fee and the request for an additional card. Do not forget that these cards may have a fixed cost, which will be paid only for owning this card even if you do not get to use it. Let’s look well because there are entities that do not charge you a single euro of commissions.