Credit unions and banks issue credit cards  

that differ in a number of important ways:

  The annual percentage  

rate (APR), which  

determines the  

monthly finance  

charge on any  

unpaid balance 

  Whether there is a grace period, which is the  

time between the date  

the card issuer sends  

you your new balance  

and the date your  

payment is due

  Whether there’s  

an annual fee, which  

can vary significantly  

from one issuer to  

the next
As you weigh your options, you need to be 

realistic about your borrowing habits. If you’re 

confident you’ll always pay your outstanding 

balance in full and on time, a card with a grace 

period allows you to use credit while avoiding 

finance charges. However, if you generally carry  

a balance, you’ll want a card with a low APR so 

that you’ll be paying as little interest as possible.

It can be smart to use two credit cards,  

one with a low APR that you use only for major 

purchases that you’ll pay off over time and 

another for purchases that you pay off in full. 


While large outstanding loans can create  

credit problems, people are more likely to  

borrow too much using credit cards and repay  

too slowly, cutting into the money they have for 

other expenses.

To provide a wake-up call, credit card  

statements estimate the cost and the time it  

will take to pay off your outstanding balance over 

various time periods, assuming your payments 

arrive on time and you stop using the card. 

If you’re feeling the pinch of credit card  

debt, check out the repayment calculator at to 

explore how you can reduce your costs by paying 

even a little more each month.


If you run into trouble with loans or credit cards, 

help is available. The VA’s Debt Management 

Center can help you with debts you accrue  

using benefits the VA offers, like a mortgage  

loan guaranty. If you’re struggling with federal 

student loan debt, you can probably switch your 

repayment plan and reduce your payments by  

contacting your loan servicer. 

You can also find credit counseling through 

the National Foundation for Consumer Credit 

( or the Association of Independent 

Consumer Credit Counseling Agencies  


But anyone who tries to tell you there’s a  

quick fix for credit problems isn’t being honest.  

In fact, working with such people or companies  

is a waste of your time and money.


If you’re offered a free credit report  

and score anywhere but at, don’t  

believe it, even if it’s from one of the  

same three agencies. There’s a fee  

somewhere, often for a service you  

don’t need, such as credit monitoring.

30% or Less






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