- Another Perspective on Wealth
- Setting Personal Goals
- Understanding and Managing Credit
- Introduction
- Learn About Credit Bureaus, Credit Reports, and Credit Scores
- Identify Appropriate Uses for Credit Cards and Explain How They Can Help You Achieve Your Financial Goals
- Learn How Credit Cards Work and Describe the Costs Involved
- Learn How to Manage Credit Cards and Open Credit
- Summary
- Assignments
- Conclusions 1: Learning to Give
- Conclusions 2: Decide to Decide
Case Study #2 Answers
Calculations
Steve’s data:
Average daily balance $600
The formula for calculating your finance charge is your average daily balance multiplied by the interest rate divided by 12 months.
| 10% | 16% | 18% | 24% | |
| Average daily balance | $5.00 | $8.00 | $9.00 | $12.00 |
Application
If you use credit cards to finance spending (which is not recommended), it is important that you get a low interest rate on your card.
