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Credit Cards, in plain language
Grace periods, minimum payments and avoiding interest traps.
What to know
- Paying the full statement balance avoids purchase interest
- The grace period is your interest-free window
- Minimum payments keep the account current, not cheap
- Cash advances are an expensive way to borrow
Watch out: Paying only the minimum lets interest snowball, making purchases cost far more over time.
Key terms
Grace periodTime to pay before purchase interest applies.
Minimum paymentThe least you can pay to stay current.
Cash advanceBorrowing cash on a card — high fees, no grace period.
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