Paying only the minimum due each month does not help save money on interest; in fact, it extends the time needed to pay off the balance and increases interest costs. The other statements accurately describe how credit cards function.

Building a positive credit history by using a credit card responsibly is a major benefit as it can improve your credit score over time. The other options either exaggerate benefits or state inaccuracies about credit card use.

Paying off the full balance each month prevents the accrual of interest charges and supports sound financial management. The other practices can lead to increased interest and financial penalties.

The credit limit is the maximum amount you are allowed to borrow on your card. The other options describe different aspects of credit card features that are not related to the credit limit.

Credit cards allow you to borrow money and pay it back later, often with interest if not paid in full. In contrast, debit cards withdraw funds directly from your bank account at the time of the purchase.

Interest only accrues on the amount you have actually borrowed, not on your entire credit limit. The other statements accurately reflect how credit card interest is applied and prevented.

A high credit utilization rate indicates that you are relying heavily on borrowed credit, which can lower your credit score. Keeping your utilization low is one of the keys to maintaining a healthy score.

The misconception is that paying just the minimum quickly reduces your debt, when in reality it prolongs the repayment period and increases interest costs. The other statements accurately describe how minimum payments function.

It is a common myth that rewards points can be redeemed without any restrictions. In reality, there are often limitations, expiration dates, and conditions tied to redeeming these points.

Maxing out your credit card regularly can significantly raise your credit utilization ratio, negatively affecting your credit score. The other practices are all recommended for maintaining a strong credit profile.

Missing a payment typically results in late fees and can harm your credit score over time. The other options do not accurately reflect the standard consequences of a missed credit card payment.

The grace period is the time frame during which you can pay your full balance and avoid interest charges on new purchases. The other options do not accurately define the concept of a grace period.

It is a myth that carrying a balance - even a small one - improves your credit score. In truth, paying your balance in full is the best practice to maintain and boost your credit health while avoiding extra interest.

It is not always true that cards with annual fees offer better rewards than those without; the quality of rewards varies and depends on individual financial needs. The other statements accurately describe common practices regarding annual fees.

The credit utilization ratio is the metric that shows what percentage of your available credit you are using. Maintaining a lower ratio is beneficial for your credit score.

It is a misconception that a balance transfer by itself will always boost your credit score. While transferring balances may lower interest costs, your overall financial behavior, including on-time payments and credit management, plays a larger role in determining your score.

The fallacy is the belief that the benefits offered during the introductory period will last indefinitely. In reality, these offers are temporary and typically transition to standard, higher rates once the introductory period ends.

The inaccurate belief is that closing a credit card account erases any obligation for past charges. In reality, any existing balance must still be repaid, and closing an account can reduce your available credit and affect your credit score.

It is not true that a card is automatically canceled immediately upon reporting fraud without any further steps. The process usually involves verifying the fraudulent activity and taking appropriate measures rather than an instant cancellation.

The myth is that opening several credit cards in a short period does not affect your credit score. In reality, multiple credit inquiries and the potential for mismanagement can have a negative impact on your score.