By Milton Jones, Collections & Card Services Director
Credit cards can be a smart financial tool when used well. The right credit card can:
- Help you build or repair credit
- Help you pay down higher-interest debt
- Be safe and convenient to use while traveling
- Keep your cash or savings liquid if you have an emergency or need an
- Reduce the risk of fraud involving your checking or debit card accounts by using a separate payment method to make purchases
It’s important to be conscientious of your spending habits and how you manage your money. Will you carry a balance or will you pay off your credit card statement each month? When will the payment be due? Make sure your credit card usage fits into your personal budget and financial plans.
Examine credit card offers carefully
Enticing credit card offers may flood your mailbox, inbox, checkout lines and virtual shopping carts. The savings or rewards sound like great deals. But the fine print may have you paying more than you bargained for.
For example, you might receive an offer like, “Save 20% on today’s purchase when you sign up for the store credit card.” That 20% discount might come with an 18% annual percentage rate (APR) – or higher. If you don’t pay off the balance right away, your “savings” disappears quickly and you could end up paying more than the full retail price.
Be sure to examine offers carefully before signing up. Instead of opening a new store credit card, a better option may be to use a Cinfed Mastercard which offers lower rates, plus the opportunity for rewards or cash back.
Find answers to these four questions
Do some homework before you sign up for a credit card to make sure you’re getting the best deal. Find the answers to these four questions: