Good credit can open doors to buying a home or a car, but credit can also come with some risks if you do not understand the specific terms and conditions or abuse your power to make purchases with credit.
Before you obtain a credit card it is extremely important to weigh the benefits and the risks to make sure it is in your best interest to do so.
Benefits vs. Risks
|Helps in emergencies||High fees|
|Convenient||High interest rates|
|Easy for internet purchases||Short or no grace period|
|Required for car rental||Leads to impulse purchases|
|Safer than carrying cash||Can lead to bad credit if not used properly|
|Possible travel & cash back rewards||Confusing credit terms|
CREDIT REPORT WEBSITES
All US residents may receive one credit report from each bureau annually. Contact the three credit bureau reporting agencies below to request your copy.
- annualcreditreport.com is free
- freecreditreport.com is not free -- it is a subscription site from one of the credit bureaus that will try to sell you reports from the other two
- www.MyFICO.com - see a pie chart of what goes into your credit score
- www.bankrate.com - see what credit cards offer the best rate
AAMC FACT SHEETS