Georgia Credit Card- Understand How a Credit Card Works

By: EconomyWatch Content Team   Date: 28 January 2010

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Before you start using your brand new Georgia credit card it helps to understand how a credit card works. A credit card is a type of plastic that is exactly as it sounds- it is a small card that carries credit and is available to those who qualify for it. A credit card should not be mistaken with a debit card. With a debit card you are using your own money that is in your bank account. With a credit card you are borrowing money from a credit card company that has extended you credit which must be paid back with interest.

It is also important to note that credit cards and charge cards are not the exact same things. However the terms are often used to mean the same thing. The balance that is on a charge card must be paid in full at the end of a month while a credit card does not have to be. However is it to your detriment if you carry a balance on your credit card from one month to the next because you will be charged interest. When you carry your balance over on your Georgia credit card it is called revolving the balance.

You must apply for a credit card and then be approved before it will be sent to you through the mail. Once you receive the card you must call the number given to activate it. You also must sign your name on the back of the card and read over all of the relevant documents enclosed.

You are then free to use your card to make purchases as you see fit. You will be given a credit limit and it is not advisable to go beyond it. In fact it is wise to never charge more than 30 percent of what your credit limit is. Some credit cards are widely accepted at most establishment you may frequent while others are not as common. When in doubt, find out ahead of time.

Whatever you use your Georgia credit card for it must be paid back. Do not think of your credit card as plastic money or worse, free money because there is nothing free about it. When you make a purchase with your card you will be required to sign a receipt. You will then be sent a monthly statement showing all of your transactions including your purchases and how much money you owe including all applicable fees. 

You can pay the balance off in full or you can pay a lesser amount. It is advisable to pay the entire outstanding balance off so you will not be charged any interest on your Georgia credit card. That way every month you start off fresh. However if you must carry a balance then it is important that you pay more that the minimum required per your statement. 

 


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