Nick Farina: So that is really the big point, is to stop complaining and get educated because every article I read - and I'm sure you've seen the same thing, almost without fail, a young person or even an older person who is talking about how they've ruined their life in some way even though of course they haven't. Or they've ruined their credit or something that the credit organization has done to them, it's always avoidable, almost always. Except in the cases of extreme illness or even in the loss of a job because they did not have emergency fund. So yes, it's always avoidable and if you just read the contract, if you make your payment on time, you're not going to run to these problems. I know people always ask me, what is an APR? They're going to adjust it to this rate here and that's not fair. An annual percentage rate shouldn't be important when you're applying for a credit card with a young person, because you should be paying your balance off every month. It's okay. You can have a credit card with a 45% APR, because you shouldn't even be worrying about the APR, absolutely.
Monty Loree: Say that again, why is it not important if you got a 45% interest rate? It goes to, you've just said it, you should pay off your balance every month.
Nick Farina: Absolutely. I think in many ways that a high interest rate is in fact a healthy thing because it's a deterrent if you understand that. Because a young person is taking out his credit card, if the APR is likely to going be very high and if they understand what that means – than on a $1,000.00 balance you can pay $450.00 in interest in a year. Then they might be less likely to run up their balance. That is safe to know that it's not important because if you pay your credit card bill at the end of every month on time, like you're supposed to, you're not going to pay interest. You're not going to have horrible things happen to you. Capital One is going to give you a good cause than you are. Oftentimes, you get rewards for it. That's another thing that I've tried. Over the five years that I've had credit cards, I haven't paid a cent in interest. On top of that, I've gotten hundreds of dollars in rewards, free from these companies. I've taken money from the credit card companies. In fact, I've probably taken the money from the people who didn't pay their bills on time.
See previous part with Nick Farina - Part 5
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