2.1 a student credit card——topic:student credit cards

1. listening script

Man: Hi, Sis. I just came over to drop off the DVDs you wanted, and . . . Hey, wow!? Where did you get all of this stuff?
Woman: I bought it. So, what do you think of my new entertainment center? And the widescreen TV . . .
Man: Bought it?
Woman: . . . and my new DVD player. Here, let me show you my stereo. You can really rock the house with this one.
Man: But where did you get the dough to buy all this? You didn’t borrow money from mom and dad again, did you?
Woman: Of course not. I got it with this!
Man: This? Let me see that . . . Have you been using Dad’s credit card again?
Woman: No, silly. It’s mine. It’s a student credit card.
Man: A student credit card? How in the world did you get one of these?
Woman: I got an application in the mail.
Man: Well, why did you get one in the first place?
Woman: Listen. Times are changing, and having a credit card helps you build a credit rating, control spending, and even buy things that you can’t pay with cash . . . like the plane ticket I got recently.
Man: What plane ticket?
Woman: Oh yeah, my roommate and I are going to Hawaii over the school break, and of course, I need some new clothes for that so . . .
Man: I don’t want to hear it. How does having a student credit card control spending? It sounds like you’ve spent yourself into a hole. Anyway, student credit cards just lead to impulse spending . . . as I can see here. And the interest rates of student credit cards are usually sky-high, and if you miss a payment, the rates, well, just jump!
Woman: Ah. The credit card has a credit limit . . .
Man: . . . of $20,000?
Woman: No, no quite that high. Anyway, . . .
Man: I’ve heard enough.
Woman: Did I tell you we now get digital cable with over 100 channels? Oh, and here’s your birthday present. A new MP3 player . . .
Man: Yeah. Oh, don’t tell me. Charged on the credit card. Listen. Hey, I don’t think having a student credit card is a bad idea, but this is ridiculous. And how in the world are you going to pay off your credit card bill?
Woman: Uh . . . with my birthday money? It’s coming up in a week.
Man: Hey, let’s sit down and talk about how you’re going to pay things back, and maybe we can come up with a budget that will help you get out of this mess. That’s the least I can do.

2. vocabulary

• dough = informal for money =钱
  -I need more dough to pay off my credit card bill.
• have money to burn = have a lot of money =有很多钱
  -Sara’s dad always gives her a big allowance, so she has money to burn.
• in the world: used to emphasize something you say
  -Why in the world would you buy an expensive TV if you didn’t have enough money?
• rating (noun): a measure to show how good something is
  – You should look over the ratings for MP3 players before you buy one.
• spend yourself in a hole (idiom): spend too much that leads to heavy debt
  – Some people spend themselves in a hole because they can’t control their shopping habits.
• impulse (noun): a sudden desire
  – You can let your impulses to buy stuff get in the way of good common sense and judgement.
• sky-high (adjective): very expensive
  – Prices for houses in this area are sky-high, so I’m going to look for an apartment for the time being.

3. wrong problem reflection

Q:The credit card limit on the woman’s card is about _____.
A: $18000
hint:
Woman: Ah. The credit card has a credit limit . . .
Man: . . . of $20,000?
Woman: No, no quite that high. Anyway, . . .
“Not quite that high” could mean that it is nearly a certain amount, but not exactly. So while the credit limit is not exactly $20,000, it is the only possible answer.

4. topic extension

(all answers generated by chatGPT-4)

4.1 pre exercise

Student credit cards are becoming more and more popular, and a number of Web sites can provide information on comparing your options. With these ideas in mind, what are the advantages and disadvantages of using credit cards, particularly for people your age and in similar financial situations?

answer:

Absolutely, credit cards can be very useful tools, especially for students who are just starting to build their credit histories. However, they must be used wisely. Here are some of the advantages and disadvantages of using credit cards, particularly for students:

Advantages:

1. Building credit: Regular use of a credit card, combined with on-time payments, can help students build a good credit history. This can be beneficial later when applying for car loans, mortgages, or even some jobs.

2. Emergencies: Credit cards can provide a safety net in case of emergencies. If a sudden expense comes up, such as a car repair, having a credit card can be helpful.

3. Convenience: Credit cards can be used almost anywhere and are more convenient and safer to carry than cash. They’re also necessary for certain transactions, like renting a car or making online purchases.

4. Rewards and benefits: Many credit cards offer rewards programs, like cash back, travel rewards, or points that can be redeemed for goods and services. Some also offer benefits like rental car insurance, warranty extensions, and fraud protection.

5. Learning financial responsibility: Having a credit card can help students learn about budgeting, interest rates, and the importance of paying bills on time.

Disadvantages:

1. Potential for debt: As mentioned before, the most significant risk of credit cards is the potential to accumulate debt. This risk is even higher for students, who may not have a steady income or may be dealing with other expenses like tuition and textbooks.

2. High interest rates and fees: Credit cards often have high interest rates, and if you carry a balance, the interest can add up quickly. Many also have fees for things like late payments or going over your credit limit.

3. Impulse buying and overspending: The convenience of credit cards can lead to impulse buying or spending more than you can afford to pay back in a given month.

4. Credit score damage: If you miss payments, it can harm your credit score. For students who are just starting to build credit, this can be particularly damaging.

5. Complex terms and conditions: Credit card agreements can be difficult to understand, and students may not be aware of things like interest rates, fees, and penalties.

In conclusion, while credit cards offer numerous benefits and can be a great tool for students, they also carry risks. It’s important to use them responsibly, to understand the terms and conditions, and to make payments on time.

4.2 post exercise

A few decades ago, getting a credit card was somewhat difficult and almost impossible for students with no credit history. Now, many students have their own. However, finding the best card is often difficult. What do you think are the dangers of having a credit card?

answer:

While having a credit card can offer a number of benefits such as convenience, the ability to build credit, and various rewards or cash back, there are also several potential dangers associated with credit card use, especially for those who may not be fully aware of these risks or have not yet developed strong financial habits. Here are a few key dangers:

1. Debt: The most significant danger is the potential to accumulate debt. If you spend more than you can afford to pay back in a given month, you’ll carry a balance and start accruing interest. Over time, this can lead to a cycle of debt that’s hard to escape.

2. High interest rates: Credit cards generally have higher interest rates compared to other types of loans. If you carry a balance, the interest can accumulate quickly.

3. Credit score damage: If you miss payments, it can harm your credit score. A low credit score can affect your ability to get loans in the future, including car loans or mortgages.

4. Over-reliance: Some people may become too reliant on credit cards and may use them as a crutch instead of planning a budget and sticking to it.

5. Fraud: While credit card companies have measures in place to protect against fraud, it’s still a risk. If your card information is stolen, it can be a hassle to resolve.

6. Hidden fees: Some credit cards have annual fees, late fees, cash advance fees, and other charges that users may not be aware of initially. These can add up over time.

7. Impulse purchases: Because they’re so convenient, credit cards can lead to impulse buying. It’s easy to lose track of how much you’re spending when you’re not physically handing over cash.

8. Creating a false sense of wealth: Credit cards can create a sense of wealth that isn’t real. Just because you have a high credit limit doesn’t mean you should use it all.

For students or people new to credit, it’s especially important to understand these risks. Educating yourself about credit cards and financial management in general can help you avoid these pitfalls and use credit cards to your advantage. Remember, a credit card is a tool, and like any tool, it can be used for good or bad depending on how you handle it.

4.3 online research

Conduct research on two different credit cards offered online that are specifically aimed at students.

• compare them based on
  • credit card fees
  • interest rates
  • benefits
• check to see if these companies provide credit monitoring which is
  one component of identity theft protection services.
• examine whether there are any hidden costs that credit card users
  might not be aware of when using the card.
• Are there any other options besides credit cards that students can
  use to make purchases?

answer：

Discover it® Student Cash Back:

1. Fees: There is no annual fee for this card. There’s also no foreign transaction fee, which can be a bonus for students studying or traveling abroad. However, there are fees for late payments and returned payments.

2. Interest Rates: The card typically comes with a 0% introductory APR for the first six months, after which a variable APR applies, based on your creditworthiness and the market Prime Rate.

3. Benefits: The card offers 5% cash back in categories that change each quarter, up to the quarterly maximum when you sign up, and 1% cash back on all other purchases automatically. Additionally, Discover matches all the cash back you’ve earned at the end of your first year.

4. Credit Monitoring: Discover provides a free service that alerts you if your Social Security number is found on any of thousands of Dark Web sites. This is part of Discover’s identity theft protection features.

Journey Student Rewards from Capital One:

1. Fees: There is no annual fee for this card. However, there are late payment fees. Also, there is no foreign transaction fee, which can be beneficial for students traveling or studying abroad.

2. Interest Rates: The card doesn’t offer an introductory APR, and there’s a variable APR from the get-go, depending on your creditworthiness and the market Prime Rate.

3. Benefits: The card offers 1% cash back on all purchases, and you can boost your cash back to a total of 1.25% each month you pay on time.

4. Credit Monitoring: Capital One offers CreditWise, a free service that allows you to track your credit score over time, view the factors that are impacting your score, and receive alerts when there are changes to your credit profile. This service can help you monitor for signs of identity theft.

As for hidden costs, it’s crucial to understand that interest can quickly accumulate on any balance that isn’t paid off in full each month. Late payment fees can also add up and negatively impact your credit score. Additionally, exceeding your credit limit can result in over-limit fees, and cash advances usually come with their own fees and higher interest rates.

there are several alternatives to credit cards that students can use to make purchases. Here are a few options:

1. Debit Cards: These cards are linked directly to a checking account. When you make a purchase with a debit card, the money is withdrawn directly from your account. This can help prevent overspending, as you can only spend what’s in your account.

2. Prepaid Cards: These are cards that you load with money ahead of time. Once the money on the card is spent, the card can no longer be used until it’s reloaded. This can be a good way to manage a budget and prevent overspending.

3. Mobile Payment Apps: Many students use mobile payment apps like Venmo, PayPal, Zelle, or Cash App to make purchases or pay back friends. Many of these apps can be linked to a bank account or debit card.

4. Student Checking Accounts: Many banks offer checking accounts specifically designed for students. These accounts often come with debit cards for making purchases.

5. Secured Credit Cards: For students looking to build credit but worried about the risk of overspending, a secured credit card might be a good option. These cards require a security deposit which typically sets your credit limit. Over time, responsible use of a secured card can help build a credit history.

6. Buy Now, Pay Later Services: Services like Afterpay, Klarna, and Affirm allow you to make a purchase and pay it off in installments. Be aware, though, that late payments can lead to fees and interest.

7. Bank Transfers and Checks: Although less common these days, especially for small purchases, these traditional methods are still viable.

Each of these options has its own pros and cons, and some might be more suitable than others depending on the student’s financial situation and spending habits. It’s important to consider each option carefully and choose the one that best fits individual needs and circumstances.