AHRM 2304 Lecture Notes - Lecture 6: Federal Trade Commission, Annualcreditreport.Com, Experian

• School: Virginia Tech
• Department: Apparel, Housing, and Resource Management
• Course: AHRM 2304
• Professor: Solis

Document Summary

Purchase big ticket items (appliances, furniture, homes, cars) Use of credit reduces financial flexibility and buying power. Make impulse purchases and could lead to overspending. Interest on credit is usually expressed in terms of apr (annual percentage rate) Monthly payments are made up of a portion of the original loan and interest. One way to lower the total cost of borrowing is by increasing the monthly amount you pay. Assume you have a credit card balance of with an apr of. If you only pay per month and make no additional purchases, it will take you 10 years to pay off your credit card! If you only pay the minimum every month and make no additional purchases, it will take you 33 years to pay off your credit card! If you make only payments until the purchase is paid off, you will have paid in interest on your purchase.