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What is APR and why is it important?

APR stands for Annual Percentage Rate. It's the annual interest rate you'll pay if you carry a balance on your credit card.

Key points about APR:

  • Higher APR = More expensive: A higher APR means you'll pay more in interest charges
  • Different types: Purchase APR, balance transfer APR, and cash advance APR may differ
  • Intro rates: Many cards offer 0% APR for a limited time on purchases or balance transfers
  • Avoid interest: Pay your full balance each month to avoid paying interest