Question

Please help me with this credit card assignment! (Personal Finance) I need this done by tomorrow! Please help! I’d greatly appreciate it!

Credit Card #1
Truth in Lending Disclosure Statement

Annual Percentage Rate (APR)
1 percent for the first six months after you open the account.
After six months, APR will be 24 percent.

Grace Period
a minimum of twenty-five days to repay without finance charges if the previous balance is paid in full by the due date

Annual Fee
$0

Other Fees
cash advance fee: the greater of $5 or 3 percent of the amount of the cash advance; late payment fee: $30; over-the-limit fee: $30

Credit Card #2
Truth in Lending Disclosure Statement

Annual Percentage Rate (APR)
19.9 percent

Grace Period
a minimum of twenty-five days to repay without a finance charge if previous balance is paid in full by the due date

Annual Fee
$20

Other Fees
cash advance fee: the greater of $3 or 3 percent of the amount of cash advance; late payment fee: $30; over-the-limit fee: $20; returned check fee: $20

Credit Card #3
Truth in Lending Disclosure Statement

Annual Percentage Rate (APR)
19.9 percent

Grace Period
a minimum of twenty-five days to repay without finance charges if the previous balance is paid in full by the due date

Annual Fee
annual membership fee: $50
annual participation fee: $60 ($5 charged monthly)

Other Fees
cash advance fee: $20; balance transfer fee: $25; late payment fee: $20. over-the-limit fee: $20


(Part One)
Read each of the above Truth in Lending Disclosure Statements and answer the questions that follow.

What happens to the interest rate after six months for credit card #1?

Which credit cards have an annual fee?

Is the grace period the same for each of these credit cards?

What fees does credit card #3 have that the other cards do not?

As a good steward, you will pay your credit card bill on time and you will pay the balance each month. Which credit card is the best for you?

1. What happens to the interest rate after six months for credit card #1?
2. Which credit cards have an annual fee?
3. Is the grace period the same for each of these credit cards?
4. What fees does credit card #3 have that the other cards do not? 5.
As a good steward, you will pay your credit card bill on time and you will pay the balance each month. Which credit card is the best for you?

(Part Two)
Go online or visit a financial institution to find information about three credit cards. Some credit cards offer incentives, such as miles toward a free flight or 1 percent back on every dollar you spend. Research information about annual fees, APR, and incentives that credit cards offer. Write two paragraphs of 250 words total, one paragraph about the three credit cards you researched and one paragraph stating which credit card would be best for you and why.

Answer 1

1. What happens to the interest rate after six months for credit card #1? After six months, the APR for credit card #1 will be 24 percent.
2. Which credit cards have an annual fee? Credit card #2 has an annual fee of $20. Credit card #3 has an annual membership fee of $50 and an annual participation fee of $60 ($5 charged monthly).
3. Is the grace period the same for each of these credit cards? Yes, the grace period is the same for all three credit cards, which is a minimum of twenty-five days to repay without finance charges if the previous balance is paid in full by the due date.
4. What fees does credit card #3 have that the other cards do not? Credit card #3 has a cash advance fee of $20 and a balance transfer fee of $25. It also has an annual membership fee of $50 and an annual participation fee of $60 ($5 charged monthly).
5. As a good steward, you will pay your credit card bill on time and you will pay the balance each month. Which credit card is the best for you? Credit card #1 would be the best choice for a good steward who pays their credit card bill on time and in full each month since it has no annual fee and offers a lower introductory APR of 1 percent for the first six months. This will allow the cardholder to save money on interest charges during the first six months, which can be useful if they need to make a large purchase and need some time to pay it off. However, it's important to note that if the balance is not paid in full by the due date, the APR will increase to 24 percent, which is significantly higher than the other two credit cards.

Answer 2

Step-by-step explanation:
Part One:

After six months, the APR for credit card #1 will be 24 percent.

Credit card #1 and credit card #2 do not have an annual fee. Credit card #3 has an annual membership fee of $50 and an annual participation fee of $60 ($5 charged monthly).

Yes, the grace period is a minimum of twenty-five days to repay without finance charges if the previous balance is paid in full by the due date for all three credit cards.

Credit card #3 has a balance transfer fee of $25 that the other cards do not have.

As a good steward who pays their credit card bill on time and pays the balance each month, credit card #1 would be the best option as it has a 0 percent APR for the first six months, no annual fee, and the same grace period as the other cards.

Part Two:

After researching three credit cards, I found that Credit Card A has an annual fee of $95, an APR of 17.49 percent to 24.49 percent, and offers 2 miles per dollar spent on travel and dining. Credit Card B has no annual fee, an APR of 15.49 percent to 25.49 percent, and offers 1.5 percent cashback on every dollar spent. Credit Card C has an annual fee of $550, an APR of 16.99 percent to 23.99 percent, and offers a wide range of travel benefits, including access to airport lounges, a $200 annual airline credit, and 5 points per dollar spent on air travel and hotels.

Based on my research, I believe that Credit Card B would be the best option for me. While Credit Card A offers good rewards for travel and dining, the annual fee is quite high. Credit Card C also has a high annual fee, and while the travel benefits are appealing, I don't travel enough to make full use of them. Credit Card B, on the other hand, has no annual fee and offers a competitive cashback rate on every dollar spent, making it a good choice for everyday use. Additionally, the APR range is comparable to the other cards, and the grace period is the same as the other cards, giving me the flexibility to pay my balance in full each month without incurring finance charges.