Have you received credit card offers in the mail? If so, you might have wondered which cards really offered good deals. Credit cards can be helpful budgeting tools, or sinkholes of debt. The difference is in the details: some cards have high rates and fees that make it difficult to keep your debt in check. Take a moment to compare credit cards before you decide to carry one in your wallet.
Credit card offers list the terms and conditions of various cards. When you compare credit cards, look at the interest rate, also known as the APR. It might be listed as 0%. If so, you can bet that it will be much higher in six months to a year. 0% interest cards have introductory phases. After that phase has ended, they are subject to regular interest rates. Most cards offer 12-24% interest rates. The lower the rate, the faster you’ll be able to pay off your debt.
Also make note of the type of interest rates on your credit card offers. Some rates might be “fixed”, and some might be “variable”. Choose fixed-rate interest whenever possible. Variable interest rates can change with little warning from the card issuer. If you do choose a credit card with a variable interest rate, make sure you know when and how much that rate can change.
When you compare credit cards, you’ll notice that some of them come with quite a lot of fees. There can be application fees, processing fees, annual fees, late fees, and fees for going over your credit limit. Fees can also apply when you close your account or make a balance transfer to another card. The credit card industry is competitive, so don’t waste your time on credit card offers that indicate exorbitant fees.
Your next step when you compare credit cards is to look at the credit limit each one is willing to give you. Some might offer low limits, while others might offer you thousands of dollars. Higher credit limits can improve your credit score, but they can also tempt you to spend money on things you can’t really afford.
Always check the small print on credit card offers. Companies should tell you their policies regarding interest-free grace periods, late payments, and how you will be informed if changes are made to the terms of your contract. If you have questions about specific policies, call the card’s customer service division and ask to speak with a representative. Most card companies are only required to give 14 days’ written notice when making changes to your account. There is pending legislation that seeks to compel card issuers to give more notice before such changes are made.
Don’t just accept the first credit card offers that come along. Take the time to compare credit cards. They can be great for building up your credit, but they can also leave you with a heap of debt if you don’t use them wisely. Look for good deals with low fees and interest rates. The research you do in the beginning can save you a lot of financial heartache down the road.
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Friday, 10 June 2011
Things to Consider Before Accepting a New Credit Card
It's becoming increasingly difficult to get by in our society without a credit card – or at the very least, a debit card with a credit card logo. Travel arrangements, restaurant reservations, online business transactions and placing orders by telephone all require the use of a credit card. Here are some things to consider before signing your name to a new credit card application:
Don't Get Too Many Cards – there is hardly ever a good reason for a person to have a wallet overflowing with multiple credit cards. Typically, you only need one or two credit cards. Be selected and choose cards that will work best for how you use them and pay them back. Too much credit available can lead to bad financial decisions made on a whim, and then unmanageable debts.
Take a Hard Look at Your Spending Habits if You Get A lot of Credit Card Offers – just because you have four credit card offers in your mailbox every day does not mean you can afford more credit cards. In fact, credit card companies tend to target individuals who are most likely to rack up big balances because they know they'll make the most interest off you.
Don't Fall For Teaser or Promotional Rates – many credit cards do their best to entice new customers through teaser or promotional rates. These are typically lower than average interest rates on new purchases or balance transfers that apply for a limited time – but then once that time is up, the interest rate shoots up. These are also cards that often send your interest rate skyward if you make a payment late. The permanent interest rate on a credit card is much more important than the temporary promotional offer you get; unless you are using the card to pay off a higher interest account and will have the balance completely paid in full before the promotion ends.
Examine More Than the Interest Rate – while the interest rate on a credit card is an important consideration before accepting a new card, it's not the only thing that matters. The interest rate actually only matters for people who carry a balance from one month to the next, because if you pay your balance off in full within the stated grace period (typically 20 days), there is no interest charged. Also, when you make a decision for a credit card based solely on the interest rate, you might be very disappointed when the interest rate changes a few months after you get the card. Even “fixed rate” interest cards can adjust their interest rates.
How Does the Credit Card Billing Cycle work - knowing the cards billing method is a good idea. Will the interest be applied to your purchases from the day you use the card, or is there a grace period? How many days do you have between billing cycles to pay off your balance before interest is applied? Know exactly how long this grace period is because your lender is likely to mail the bill out late in the billing period, giving you just a couple days in which you can get your payment out before it falls outside that grace period.
Understand Late Payment Charges and Penalties – Check the credit card terms carefully to understand how late payment charges and penalties are charged to your account if you should make a payment late. See if a late payment will also result in an interest rate hike. Most credit cards apply the late payments and penalties to the card balance, and therefore you end up paying interest on these if you don't pay the balance of your card off in full before the end of the billing cycle, as well.
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Don't Get Too Many Cards – there is hardly ever a good reason for a person to have a wallet overflowing with multiple credit cards. Typically, you only need one or two credit cards. Be selected and choose cards that will work best for how you use them and pay them back. Too much credit available can lead to bad financial decisions made on a whim, and then unmanageable debts.
Take a Hard Look at Your Spending Habits if You Get A lot of Credit Card Offers – just because you have four credit card offers in your mailbox every day does not mean you can afford more credit cards. In fact, credit card companies tend to target individuals who are most likely to rack up big balances because they know they'll make the most interest off you.
Don't Fall For Teaser or Promotional Rates – many credit cards do their best to entice new customers through teaser or promotional rates. These are typically lower than average interest rates on new purchases or balance transfers that apply for a limited time – but then once that time is up, the interest rate shoots up. These are also cards that often send your interest rate skyward if you make a payment late. The permanent interest rate on a credit card is much more important than the temporary promotional offer you get; unless you are using the card to pay off a higher interest account and will have the balance completely paid in full before the promotion ends.
Examine More Than the Interest Rate – while the interest rate on a credit card is an important consideration before accepting a new card, it's not the only thing that matters. The interest rate actually only matters for people who carry a balance from one month to the next, because if you pay your balance off in full within the stated grace period (typically 20 days), there is no interest charged. Also, when you make a decision for a credit card based solely on the interest rate, you might be very disappointed when the interest rate changes a few months after you get the card. Even “fixed rate” interest cards can adjust their interest rates.
How Does the Credit Card Billing Cycle work - knowing the cards billing method is a good idea. Will the interest be applied to your purchases from the day you use the card, or is there a grace period? How many days do you have between billing cycles to pay off your balance before interest is applied? Know exactly how long this grace period is because your lender is likely to mail the bill out late in the billing period, giving you just a couple days in which you can get your payment out before it falls outside that grace period.
Understand Late Payment Charges and Penalties – Check the credit card terms carefully to understand how late payment charges and penalties are charged to your account if you should make a payment late. See if a late payment will also result in an interest rate hike. Most credit cards apply the late payments and penalties to the card balance, and therefore you end up paying interest on these if you don't pay the balance of your card off in full before the end of the billing cycle, as well.
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Thursday, 9 June 2011
Which Credit Card Is Right For You?
If you are shopping around for a new credit card, you may be wondering how do I pick one that is right for me. After all, there are so many options available that it can be overwhelming. There are however, a few basic things to consider before making your choice. Mainly you have to consider what your needs and spending habits will be with your new card.
The first question you need to ask yourself is how do I plan to use the credit card? This question is important, because certain cards will make more sense, depending on how you plan to use them. For example are you planning to pay off your balance every month? If you said yes, are you positive you are being realistic about this expectation? If so, then you are someone who may not really need to look at things like APR’s and other fees, because they simply won’t affect you.
If however, you plan to carry a balance or are very likely to carry a balance, then you will want to pay close attention to how interest will be compounded on your debt. To begin with you will want to check the APR. Look for a card with a low rate, preferably a low fixed rate.
Are you looking to transfer a balance from another card that you need to pay off? If this is you, spend some time looking for a balance transfer card that either offers a good introduction APR like 0% interest for several months or one that has a lower, locked in interest rate. Be careful if choosing a low start up rate. Check to see what the terms are and what your rate will jump to after the promotion time period ends. Sometimes these cards, if you can’t pay the balance off before the end of the promotional period, turn out to not be cost effective.
Are you looking for particular features and benefits from a credit card? Like getting a card that has a rewards program for example? If this is you, there are an abundance of options available. You can earn everything from dining certificates to free travel to cold hard cash. Shop around and pick one that fits your needs. Just be careful to check card terms and make sure they fit your needs before signing up.
In picking a credit card that is right for you there are other things that you should also consider. You will want to check all the fine print. Some cards charge annual fees that you will have to pay each year. If you are looking to use your card to transfer a balance there will most likely be a balance transfer fee. Almost all cards also charge fees for using your card to get cash. Some credit card companies today are even imposing fees to their customers for inactivity. If you don’t use your card enough or don’t charge enough on your account during a certain time period they will charge you a set fee.
Before applying for a card you will also want to know what your credit score is and what cards you will qualify for. In today’s economy it can be more challenging to get credit, unlike times in the past. If you have poor credit you may have to look into building your credit before you are able to get the credit care you truly want.
No matter what card you choose, remember that with a credit card comes responsibility. When you are issued a credit card you should always use it wisely. Proper use will ensure that the credit card company is reporting you in good standing to the credit bureaus each month. Using your credit card carelessly can hurt your credit.
If you want to check out the Barclays Credit Card Review please visit this site for more in depth info.
Enjoy! :)
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The first question you need to ask yourself is how do I plan to use the credit card? This question is important, because certain cards will make more sense, depending on how you plan to use them. For example are you planning to pay off your balance every month? If you said yes, are you positive you are being realistic about this expectation? If so, then you are someone who may not really need to look at things like APR’s and other fees, because they simply won’t affect you.
If however, you plan to carry a balance or are very likely to carry a balance, then you will want to pay close attention to how interest will be compounded on your debt. To begin with you will want to check the APR. Look for a card with a low rate, preferably a low fixed rate.
Are you looking to transfer a balance from another card that you need to pay off? If this is you, spend some time looking for a balance transfer card that either offers a good introduction APR like 0% interest for several months or one that has a lower, locked in interest rate. Be careful if choosing a low start up rate. Check to see what the terms are and what your rate will jump to after the promotion time period ends. Sometimes these cards, if you can’t pay the balance off before the end of the promotional period, turn out to not be cost effective.
Are you looking for particular features and benefits from a credit card? Like getting a card that has a rewards program for example? If this is you, there are an abundance of options available. You can earn everything from dining certificates to free travel to cold hard cash. Shop around and pick one that fits your needs. Just be careful to check card terms and make sure they fit your needs before signing up.
In picking a credit card that is right for you there are other things that you should also consider. You will want to check all the fine print. Some cards charge annual fees that you will have to pay each year. If you are looking to use your card to transfer a balance there will most likely be a balance transfer fee. Almost all cards also charge fees for using your card to get cash. Some credit card companies today are even imposing fees to their customers for inactivity. If you don’t use your card enough or don’t charge enough on your account during a certain time period they will charge you a set fee.
Before applying for a card you will also want to know what your credit score is and what cards you will qualify for. In today’s economy it can be more challenging to get credit, unlike times in the past. If you have poor credit you may have to look into building your credit before you are able to get the credit care you truly want.
No matter what card you choose, remember that with a credit card comes responsibility. When you are issued a credit card you should always use it wisely. Proper use will ensure that the credit card company is reporting you in good standing to the credit bureaus each month. Using your credit card carelessly can hurt your credit.
If you want to check out the Barclays Credit Card Review please visit this site for more in depth info.
Enjoy! :)
Hey why not check out http://oldrepublichomewarranty.org
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