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04.Interest-free vs credit cards

Rules of thumb:

  • Small purchase amounts of $1000 and less and short payment periods such as two years and less: a credit card normally works out better, obviously the lower the interest rate the less you pay.
  • Large purchases such as $3000 over longer periods such as three years and more: interest-free can work out better than a credit card.
  • Interest-free and no-interest-ever both have high fees, but no-interest-ever may be less risky as there is no astronomical interest rate if you don't pay it off in full during the period.



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