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TABLE OF CONTENTS
- The Best Credit Cards Typically Have These Common Benefits
- Hidden Features The Best Credit Cards Offer
- How to Select the Best Visa Credit Card For You
- First Credit Card Tips
- When a Credit Card Might Be a Bad Idea?
- How to Apply for a Visa Credit Card
Type the words “credit card” into an internet browser, and you’ll be inundated with exciting offers. In fact, internet algorithms will trigger a barrage of advertisements and marketing strategies designed to sway you. You can anticipate seeing zero-interest promotions, cash-back, and seemingly attractive rewards programs. But the best credit cards offer more than these flashy promotions. The best credit cards provide consistently low-interest rates and secure benefits that truly matter. If you’re considering applying for a credit card, the following information can help you make an informed decision and find the best credit card for your unique needs.
The Best Credit Cards Typically Have These Common Benefits
Credit cards continue to grow in popularity and are quickly replacing cash. That’s largely because e-commerce platforms only take plastic, and swiping remains far more convenient. With a credit card, people tend to swipe, insert or tap their card without a thought, and just like that, the transaction is effortlessly complete. With cash, consumers stand in line counting dollars and waiting for change. To say the American culture favors credit cards over cash would be something of an understatement.
The average American possesses 3-4 credit cards, and residents of Oregon come in at 3.16, with residents of Washington having 3.53 cards, according to the Experian 2020 Consumer Credit Review. The report also indicates Baby Boomers have the most credit cards at 4.61 on average, with Gen X at 4.23, Millennials at 3.18, and Generation Z not possessing enough to effectively build a robust FICO score at 1.91.
The best credit cards allow people to purchase everything from necessities such as groceries and gas, to big-ticket items, while offering peace of mind to cover emergencies. Perhaps the following benefits are why community members would be well-served to research and apply for the best credit cards available.
Peace of Mind
Although people routinely use credit cards for a variety of purchases, there was a time when these lending products were reserved strictly for emergency spending. Families once put credit limits to work, buying only expensive items that improved their quality of life and then quickly paying down the balance. Other uses involved the ability to pay for things such as an emergency room visit, car repairs, or cover monthly bills after suffering a financial setback. The best credit cards gave people a sense of security and peace of mind knowing they could cover expenses in a pinch. That benefit still holds true today.
Increased Purchasing Power
Getting approved for a credit card automatically increases your financial bandwidth. The revolving limit effectively adds to the amount of revenue at your disposal at any given time. Without the flexible use of credit, families would likely have to put the purchases of big-ticket items on hold until they saved enough and budget ahead to enjoy dinner at a good restaurant or a night on the town. Working exclusively with cash also proves limiting in terms of convenient purchasing and spending abilities.
Keep Your Hard-Earned Money Safe
The best credit cards provide an added layer of financial security not possible with checking accounts or cash. Visa Credit Cards are backed by a zero liability that guarantees its cardholders will not be held responsible for unauthorized purchases. This extra level adds peace of mind knowing you’re protected if your Visa Credit Card is lost, stolen, or used fraudulently.
Credit card misuse can usually be reversed as long as the individual promptly reports the theft or loss. The added benefit of having a secure credit card stems from the fact it’s not linked to your checking or savings account. That makes a credit card the best possible option for online shopping. If you lose your credit card, simply contact your financial institution or credit card company, and a replacement can be swiftly issued.
Build or Repair Your Credit
As the Experian study demonstrated, young adults lag behind in credit card use, which negatively impacts FICO scores. The three major reporting bureaus – Experian, Equifax, and TransUnion – weigh specific metrics to calculate each person’s three-digit credit score. Repayment history counts for 35 percent and the average age of credit represents 15 percent. These two factors account for 50 percent of everyone’s FICO score. Applying for credit cards and utilizing them early will help establish a consistent repayment history for young adults, which will prove helpful when they seek auto loans and mortgages later in life.
By that same token, a credit card for people with “bad credit” can help rebuild their FICO score. The best way to offset missed payments or an old bankruptcy is to re-establish creditworthiness with frugal credit usage and timely payments.
To discover how a credit card for less than perfect credit can impact your credit, review our blog, "5 Ways Credit Cards For Bad Credit Can Improve Your Credit Score."
Consolidate Debt with a Balance Transfer
One of the little-known benefits the best credit cards offer involves the potential for additional savings. People that secure a low-rate Visa Credit Card can transfer the balance of a higher-interest credit card or personal loan onto their new, low-rate card. In many cases, those who learn about this perk open a low-rate credit card as a strategy to reduce wide-reaching debt.
By bringing outstanding loans and balances under one roof, you’ll only have to manage a single monthly payment. Along with reducing interest costs, it also frees up money for quality-of-life spending. And by drilling down on that sole balance, you can be debt-free and can enjoy improved financial freedom. The best credit cards allow users to transfer other debts and typically do not charge a fee for the transaction.
With all these great benefits, there are a lot of credit card options to choose from. Review our blog, "Which VISA Credit Card is Right for You? Discover Your Perfect Match" to find the best card for your lifestyle.
Hidden Features The Best Credit Cards Offer
As a consumer trying to make informed decisions, wading through all the offers and incentives makes seeing the best options difficult. Too many promotions lure consumers who believe they’re getting a great deal. Months later, interest rates spike, and the upfront benefits run dry.
It’s essential to select a credit card from a reputable local lender who works diligently with their consumers. With intentions to provide the lowest possible interest rates and a goal to increase borrowing opportunities for everyone, be sure to support your local credit union by reviewing their credit card options. When you apply for a credit card with your local credit union, you can be sure you’ll be matched with a card that fits your needs, not a sales goal. Discover the hidden benefits only the best credit cards offer.
Only the Best Credit Cards offer a Substantial Grace Period
Credit card companies aren’t required to offer a grace period, which is the period between the end of a billing cycle and the date your payment is due. Many don’t include this benefit that effectively allows cardholders to make purchases and avoid paying interest as long as they pay off the balance in full by the due date. Only the best credit cards offer their cardholders a grace period. CCCU provides a 25-day grace period as a standard benefit that comes with each credit card option.
Cash Advances Are Nice to Have
A substantial number of credit card companies allow users to withdraw cash advances. Most set cash advance limits and charge a separate fee for this transaction. It seems wrong to charge cash-strapped customers fees when the money will be repaid, and likely with interest. CCCU’s Visa Credit Cards don’t charge a transaction fee when you need an emergency cash advance.
Forgotten Perks: Auto Rental Collision Damage Waiver or Roadside Assistance
Certain credit card companies offer click-bait perks prompting people to sideline the best benefits that will save them money and only result in a headache in the long run.
Auto rental collision damage may not sound as exciting as an introductory interest rate offer, but when your rental car sustains damage due to a collision or theft, this ranks among the top money-saving benefits the best credit cards offer. Roadside assistance is another credit card benefit that has lost traction. When selecting the best credit cards to meet your goals and cover unexpected expenses, check if these are part of the package. Be sure to ask CCCU about the auto rental collision damage waiver that comes with every Visa Credit Card.
Uncover hidden credit card perks with your free guide.
Importance of Trip or Rental Car Insurance
Credit card coverage mostly applies to what’s called a collision damage waiver or loss damage waiver, typically the most expensive coverage offered at the rental counter. Cards also usually include some coverage for towing expenses and administrative fees. Many cards also cover loss of use, which means compensating the rental company for the time the car is out of service while the damage is repaired.
Emergency Card Replacement
Losing a credit card can prove something of an ordeal, particularly because so many people have pivoted away from cash in recent years. Contacting a large credit card corporation and verifying your account information only to be told a replacement could take weeks doesn’t solve your short-term problems. That’s why the best credit cards have streamlined the process and provide quick replacements in an emergency. CCCU offers emergency card replacement for every one of our Visa Credit Cards.
Emergency Cash Disbursement, A Reliable Safety Net
Although cash is no longer king, as the saying goes, some areas still prefer dollar bills. Some retailers, restaurants, and service providers require cash or checks to avoid credit card processing fees. When an emergency arises, or you need last-minute cash for an unexpected event, the ability to make a prompt cash withdrawal using a credit card may prove invaluable. CCCU is proud to offer emergency cash disbursement across the board for all of our credit card options.
The Ability to Build or Repair Your Credit Score
Choosing a low-interest credit card positions you with the opportunity to establish and rebuild your FICO scores. Young adults may not realize just how powerful that three-digit creditworthiness score proves until they get a good-paying job.
With a steady paycheck coming in each week, hardworking people usually want to purchase a reliable automobile and a home of their own. Building a FICO score that opens doors to low-interest vehicle loans and home loans takes time. It also involves creating a responsible repayment history. Getting approved for a low-rate Visa helps to prepare you for those life-changing loan options down the road.
How to Select the Best Visa Credit Card For You
Applying for a Visa Credit Card is not necessarily a difficult process. Potential applicants usually start by reviewing their credit scores and taking steps to improve their numbers. You can get a free copy of your credit report from Experian, Equifax, and TransUnion by filing an online request at Annual Credit Report. You can also ask for free copies via mail by filling out a form and sending it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
By correcting errors and fixing blemishes, there may be room to improve your FICO score within one month. Once your credit score is at its prime, research various credit card programs to find the one best suited for your needs. Keep in mind that flashy benefits may not be as important as options that save money or provide financial security. When researching available credit cards, be sure to review these CCCU options.
Low-Rate Visa Platinum Credit Card
A low interest Visa Credit Card provides improved purchasing power, standard perks, and security. This card type helps round out a consumer’s borrowing portfolio and increases credit bandwidth. Coupled with consistent, on-time monthly repayments, a low-rate Visa Credit Card provides a tremendous FICO score-building opportunity.
Low-rate Visa Credit Cards are also a great tool for those considering credit card consolidation or debt consolidation. Moving your high interest balances over to a low interest credit card with CCCU’s free balance transfer option not only saves you money, it streamlines your monthly payments too.2
Credit Card Payoff Calculator
If you have multiple outstanding credit card balances charging hefty interest rates, a credit card payoff calculator can help you formulate a plan to consolidate. Run the numbers on existing balances, interest rates, and generate detailed numbers. Discover your potential savings if you were to consolidate your debt into a Low Rate Visa Credit Card with a lower rate and no fees. The time, money, and stress relief could prove inspiring.
For more information on how to use a credit card payoff calculator, review our blog, "Credit Card Payoff Calculator: Here’s What You Need to Know".
Visa Platinum with Rewards Credit Card
Credit cards are widely marketed with rewards programs that give something back to the cardholder. Aligning those perks with your interests and goals maximizes the benefit of using your Visa Credit Card for ordinary purchases such as gas, groceries, car repairs, and other routine items. Rewards such as travel air miles, cash back and bonus points for every dollar spent rank among the most popular. Be sure to check out CCCU’s Visa Platinum Credit Card with Rewards! You’ll be automatically enrolled and when using this card, you effectively reward yourself for spending responsibly.
Credit Cards for Poor Credit
The words “credit cards for bad credit” may sound like a dangerous combination. Conventional thinking leads people to believe credit cards are only for those who have demonstrated creditworthiness. Actually, nothing could be further from the truth.
There are plenty of responsible community members who suffered financial losses, resulting in their FICO scores declining. Working families need to recover from setbacks, and perhaps the best way to rehabilitate creditworthiness is to apply for a Visa Credit Card. Once approved, it’s time to start making small consistent purchases and paying the balance off on time each month.
By maintaining manageable balances and paying them off on a regular basis, determined consumers can reverse the downward spiral of their credit score and regain financial wellness. To accomplish this goal, you’ll need a product with low interest rates and minimal fees. Although credit cards for bad credit typically cannot offer the lowest available rate, credit unions possess significant flexibility and should be your first research destination. It may be worthwhile to speak with a lending professional at your trusted local credit union about credit cards for those with less than perfect credit scores.
Compare All Fees Before Selecting the Best Credit Card
The national average interest rate charged by credit card companies hovered above 18 percent APR through the first quarter of 2022. That’s a hefty price to pay for among the country's most commonly used revolving line of credit.
The good news is that credit unions typically charge lower credit card interest rates, giving members greater spending capacity while allowing them to keep their hard-earned money. When selecting a credit card, weigh the interest rate, annual fees, rate escalators, balance transfer charges, and anything that costs extra. Compare the total cost of the program against others before signing an agreement.
First Credit Card Tips
Don’t get swept up in the excitement. It’s important for first-time credit card applicants to take a moment to read the entire agreement thoroughly. Ask questions, and don’t hesitate to walk away if you feel uncomfortable about potential fees, interest rates, or other concerns. Once you do secure the right credit card with reasonable rates and terms, use it wisely. These are common faux pas new cardholders make that should be avoided.
- Engaging in a Spending Spree
- Overspending to Get Rewards Points
- Failing to Craft a Monthly Budget
- Carrying High Balances that Negative Impact FICO scores
- Missing Payments and Incurring Late Charges
- Applying for Other Credit Cards Too Soon
A first credit card can be a wonderful opportunity to expand your borrowing capacity and build a healthy credit score for future use. By that same token, overspending and irresponsible practices can harm a FICO score and strain your finances.
For more first credit card tips, review our blog, "Getting Your First Credit Card? 6 Mistakes To Avoid."
When a Credit Card Might Be a Bad Idea?
Possessing a credit card with a reasonable spending limit is rarely a bad idea. However, misuse can result in personal and financial upheaval.
Having a credit card is not a license to spend. Responsible use dictates cardholders must stay within their means and have the capacity to pay more than monthly minimums. Carrying high balances negatively affects the credit utilization FICO score metric. Credit utilization accounts for 30 percent of your total score. If use exceeds 30 percent of your total available credit, your three-digit credit score drops. In addition to your score dropping, lenders also prefer potential borrowers and credit card applicants to remain below the 30-percent threshold. This may impact your ability to get approved for other loans and lines of credit down the road.
Wondering, “How Many Credit Cards Should I Have?”
In terms of a good FICO score, a diverse range of credit cards typically helps improve the mix of accounts metric. Credit diversity involves 10 percent of a FICO score, and every digit counts when applying for the lowest possible interest rates and loan products with preferred terms. On the other hand, too many credit cards cause some people to spread spending out and become overwhelmed with monthly payments. If you practice sound money management and frequently pay off balances, three to five different credit card products are generally considered a good mix.
With so many great benefits offered by only the best credit cards, we find ourselves asking how many credit cards should we have? Review our blog, "Wondering "How Many Credit Cards Should I Have?" Here’s Your Answer" to help solve this common question.
Uncover hidden credit card perks with your free guide.
How to Apply for a Visa Credit Card
Applying for a credit card has never been easier. After reviewing your credit report and ensuring any outstanding errors have been corrected, examine possible card opportunities at your local credit union that offer the best interest rates, fees, perks, and other benefits that meet your needs.
If you have decided on a CCCU credit card, visit us online to apply! Still unsure which credit card is right for you? Contact CCCU today. We’re happy to help you select the card that fits your unique financial situation.