I am looking to get my first credit card.  Can you explain credit cards to me and what some of the important features are?
I am looking to get my first credit card.  Can you explain credit cards to me and what some of the important features are?
user
Sure, I can help you understand.  There are several things that can be confusing.
assistant
What is the interest rate on a credit card for?
user
Interest on a credit card is the cost that you pay to use the card.  The rate is expressed as a percentage of the total balance you owe.  So if your card charges you 2% interest on balances, it means that for every dollar you owe, the credit card company will charge you 20 cents of interest.
assistant
Ok then, what is a reasonable interest rate for a credit card?
user
The most common interest rates are 11% for consumer credit cards and 15% for secured credit cards.  These rates are reasonable to the card issuer, because it’s their money.  Your total balance is usually a fraction of the interest you pay on that balance.  So the cost to you to borrow that money is higher.
assistant
What is the difference between a secured and unsecured credit card?
user