Owning a credit card can be a bit complex if you’re unfamiliar with its terminologies. And for something regarded as a serious financial decision, it is pertinent to discover all of the answers you require.
The interest rate charged on credit card balances is the annual percentage rate (also abbreviated as APR). You can avoid paying interest on purchases made with credit cards if you pay off your monthly balance before or on the due date. You only accrue APR costs when you carry a balance on your credit card.
On-time payments are also required to keep a clean credit history with the credit bureaus. Another way to build credit is to keep your card active. Closing credit cards that you no longer use can lower your credit score.
850 is the highest and ideal score, with 300 being the lowest range on the spectrum. But you do not need the perfect credit score to achieve your financial objectives or be eligible for low-interest rates. A credit score of 670 or above is still good enough.
Your ability to manage credit cards will determine how many you can have. Multiple credit cards can improve your credit score if you can be discreet about their usage. If you use them poorly, the situation is the exact opposite.
If you have trouble getting cards approved, you could consider getting a secured credit card, which requires a security deposit. Alternatively, ask a parent to add you as an authorized user on their card.
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