Shopping for Credit

(I know this is like the 4th batman reference on this blog but who cares, he's a very quotable character)

1. Credit card name

1. Chase Freedom
2. Capital One Quiksilver 
3. Target Red Card

2. Type of Account

1. Credit 
2. Credit 
3. Charge 

3. Company name, address, phone (of company the card is issued by)

Chase                                                                                                                  270 Park Ave,
New York, NY 10017

(212) 270-6000

Capital One 

1680 Capital One Drive 
McLean, VA 22102-3491

(703) 720-2500

Target 

• 1000 Nicollet Mall
• Minneapolis, Minnesota 55402

(800) 440-0680

4.Website

1. https://www.chase.com/
2. https://www.capitalone.com/
3. http://www.target.com/

5. Locations where card is accepted (everywhere, or very specific)

1. Anywhere that accepts Visa 
2. Anywhere that accepts Mastercard 
3. Anywhere that accepts Visa 

6. Annual fee (if any)

1. none 
2. none 
3. none 

7. Payment grace period

1. 21 days 
2. 25 days 
3. 25 days

8. Annual Percentage Rate (APR)

1. 0% Intro APR for 15 months on purchases and balance transfers. After the intro period, a variable APR of 13.99-22.99%
2. 0% intro APR on purchases until December 2015; 12.9%-22.9% variable APR after that
3. 22.9%

9. Finance charge calculation method (this is the calculation of how your balance will be charged interest)

1. N/A 
2. Balance Method 
3. Balance Method 

10. Credit limit (is there one? Is it based on credit and income? How do they decide?)

1. Depends on your credit 
2. Limit start low then gradually increases after several on-time payments.
3. Depends on your credit.

11. Minimum payment (that is due each month. How do they calculate?)

1. $35 
2. $35 
3. $25

12. Other fees: (late payment or others that you find)

1. Max late fee: $35                                                                                                                         
2. Max late fee: $35                                                                                                                         
3. Max late fee: $35

13. Other features: (??? – you tell me)

1. Chase Freedom

• Earn a $100 Bonus after you spend $500 on purchases in your first 3 months from account opening
• Earn a $25 Bonus after you add your first authorized user and make a purchase within this same 3-month period
• 5% Cash Back on up to $1,500 in combined purchases between 1/1/15–3/31/15 at grocery stores (not including Walmart® and Target® purchases), movie theaters, and Starbucks® stores
• You'll enjoy new 5% categories every 3 months like restaurants, gas stations, and Amazon.com. It’s free and easy to activate your bonus each quarter!
• Unlimited 1% Cash Back on all other purchases

2. Capital One Quicksilver

• One-time $100 bonus after you spend $500 on purchases within the first 3 months.
• Earn unlimited 1.5% cash back on every purchase, every day.
• No rotating categories and no sign ups needed to earn cash rewards.
• Cash back doesn't expire and there’s no limit to how much you can earn

3. Target Red

• Save 5% at Target and Target.com.
• REDcard gives you 30 extra days for returns.
• Stack your everyday 5% REDcard discount with your 5% Target Pharmacy® Rewards certificate for ultimate savings on a day of Target Shopping.
• Free Shipping at Target.com       

Credit Card Analysis

 1. Which credit card has the highest annual percentage rate and how much is it?

Target- 22.9%

2. What method is used to calculate the monthly finance charge for the first major credit card?

The balance method is used for Capital One. I couldn't find this information for Chase.

3. When does the finance charge begin to accrue on the credit card from the local department store?

With your first payment

4. Do any of the cards have annual fees? If so, which one(s) and how much is the fee?

no

5. Is there a transaction fee on any card? If so, how much is it?

Chase has an international transaction fee of 3%

6. Is there a minimum finance charge on either of the major credit cards? If so, how much is it?

no

7. Does the first major credit card charge a fee for late payments? If so, how much is it?

Maximum of $35

8. What is the grace period on the credit card from the local department store?

25 days

9. Rafael wants to buy a new CD player that costs $450. According to his budget, he can afford

payments up to $62.00 per month. Which of the three credit cards you've found would you

recommend that Rafael use to purchase the CD player? Explain why.

I would use the Target RED card because it has a 5% discount at Target and free shipping on Target.com. He can pay it off in about 7 months.

10. In general, reflect on how making responsible financial decisions regarding borrowing and credit (debt) can lead to financial well-being over a lifetime.

Being cautios when deciding whether you should swipe that card or not can help you have less debt over time. Creating a budget for impulse buying can help you make responsible decisions.