Credit cards can wield a lot of clout for such a tiny piece of plastic; they can give you more purchasing power, and can be a convenient means of tracking expenses. However, if used inappropriately, it can cause a lot of stress from unpaid accounts, as well as a paper trail of bad credit history.
Whether you’re a current card owner who wants to add another line of credit for “just in case” emergencies, or a first timer who’s never swiped this powerful piece of plastic before, here are some key factors that applicants should be aware of.
1. Annual fee.
This is what cardholders are required to pay on an annual basis. Many credit card companies waive the first year’s fee, so many new owners tend to forget about this and are surprised by a new billing the following year. Owning a credit card is often viewed as a privilege, and paying an annual fee is the cost.
2. Interest rates.
Many credit card issuers offer competitive rates, especially to those with proven track records and positive credit histories. The most attractive rates are naturally the ones with the lowest amounts. Familiarize yourself with the interest rate calculation method: most calculate by averaging the daily account balance, then multiply that by the periodic rate.
3. Rewards Program.
This can be in the form of points, travel miles, rebates, or cash back, and varies depending on the type of rewards that fit your lifestyle. For example, issuers such as Security Bank offers several cards that are tailored to particular tastes. You may opt for a card that offers non-expiring rewards points, or one that provides rebates for avid motorists.
4. Benefit and other perks.
These benefits include travel insurance, merchant perks and other services. To give you an example, the Diner’s Club International and Premier credit card issued by Security bank offers free access to numerous worldwide lounges, which is an attractive benefit for those who travel regularly.
5. Take advantage of promotional financing offers.
Some credit cards offer 0% APR (annual percentage rate) financing for balance transfers or certain purchases. Get to know how long these offers are available, as they are usually on a limited basis. Familiarize yourself with any fees associated with such offers as well. Security bank has a flexible payment option called ChargeLight, which offers installment plans and 0% deals at partner merchants.
6. Superior Customer service options.
One factor that many credit card applicants overlook is the quality of customer service available for specific credit card issuers. Some features you should look for are easy bills payment options, payment convenience, and a responsive customer service hotline that you can contact 24/7, which happen to be available for Security Bank credit card holders.
As a final tip, make sure that you read the fine print on your credit card statement. Be sure to compare costs and features so you can choose the one that’s right for you. Ask questions and clarify what you don’t understand. Remember, once you sign up for a credit card, you’re bound by a legal contract, and that signature shows that you consent to the terms that were set by the credit card issuer.