Question

Credit cards wisely unwisely. Your personal habits can a big part of this. Your understanding of the small print on your credit card contract is important. Review your credit statements. Also consider the information you have gained from business programs you have listened to on radio and television, and have read internet. Then submit your thoughts as you answer the following question. Problem Wyatt Faust recently graduated from college and is evaluating two credit cards Card A : has an annual fee of $ 75.00 and an interest rate of 9 % . Card B : has no annual fee and interest rate of 16 % . Assuming that Wyatt intends to carry no balance and pay off his charges in full each month, which card represents the better option? If Wyatt expected to carry a significant balance from one month to the next, card would be

Answer 1

Assuming that Wyatt intends to carry no balance and pay off his charges in full each month, it would be better to go with Card B as there is no annual fee and he will not pay interest @16% because he intends to carry no balance and pay off his charges in full each month.

If Wyatt expected to carry a significant balance from one month to the next, card A would be better option as it carries an annual charges and 9% rate of interest which is very less than Card B (16%). By paying annual fees of 75 his finance cost would be reduced from (16% to 9%) so card A is a better option.