Credit Card Glossary
A line of credit that enables a borrower to use up to the set limit, pay down the balance, and borrow funds again. Credit cards are considered a revolving line of credit.
A set dollar amount of money that a member qualifies to use.
Carrying a Balance
Interest or Finance Charges
Interest that is accrued monthly when a statement balance isn’t paid off in full.
A yearly fee that may be charged to the borrower or cardholder. Not all cards assess an annual fee.
A strategy to pay off debt, outlined below.
- Create a working budget.
- Establish a dollar amount to apply to your debt each month. This should be the total of all of your minimum payments, plus an additional amount.
- Determine which account to target first. Your targeted account should have the lowest balance or the highest interest rate.
- Make the minimum payment on all your debts, with all additional funds going to the targeted account.
- Once the targeted account is paid off, choose a new target.