A credit card lets you borrow money to make purchases. Paying your full balance each month helps you avoid paying interest and keeps borrowing costs low.
When you use a credit card, you are borrowing money from the bank or credit union that issued the card. You will get a bill once a month for the total amount you spent.
If you do not pay the full balance, you will owe interest on the remaining amount.
Banks and credit unions offer credit cards. To get one, you must fill out an application.
When you apply, the lender will check your credit history to help decide:
Learn more about how your credit history works by visiting Understanding Your Credit History.
View TFed’s Credit Card Options to see what is available to you.
It is a good idea to compare at least three credit cards before choosing one. Look for:
If you are not approved for a traditional credit card, you may be able to get a secured credit card. This type of card requires you to make a deposit that acts as your credit limit.
A secured card can help you build or improve your credit history. Make sure the card reports your payments to the three major credit bureaus so it helps your credit over time.
Visit Improving Your Credit to learn more.
It is always best to pay your full balance each month. This way, you avoid paying interest.
If you only pay the minimum payment:
If you do not pay at least the minimum payment:
Information provided by the Federal Trade Commission. Learn more at consumer.gov.
