Understanding Credit Cards

When it comes to credit cards, sometimes it’s what you don’t know that can hurt you. Whether you’re getting your first credit card or you consider yourself a seasoned user, it’s important to know the basics. Here are some tips that will help you use credit cards to your advantage.

Finding the Right Card for You

Understanding the different types of cards will go a long way in determining which one is right for you. If you’re a student or have never had a credit card before, a starter card makes sense. If you’re an experienced credit card user, a rewards card is a smart choice. If you’re looking to rebuild your credit, a secured credit card can help you reestablish your credit. Most credit card providers all have some type of built-in rewards program. Just be sure to understand the rates and the fees associated with each type of card.

Know Your Rates

Credit cards have different features and terms that define the pricing and benefits of the card. Interest rates, annual fees and the credit limit are the three big ones. Make sure you understand the rates for purchases, cash advances and balance transfers, as they can differ. Most credit card providers offer a specific rate for purchases and a higher rate for cash advances and balance transfers from another card. Pacific Service CU offers a Visa Rewards card with the same low rate for purchases, cash advances and balance transfers.

Watch Out for Fees

Credit card companies make money by charging fees and interest. You can avoid most fees by making your credit card payment on time. You can avoid finance charges by paying your balance in full every month. Some cards offer a rewards program but charge an annual fee to offset the cost. Try to find a credit card that offers a rewards program and no annual fee, like Pacific Service CU’s Visa Platinum Rewards card. It offers no annual fee, no cash advance fee, no balance transfer fee and offers a free rewards program.

With these tips, choosing the right credit card for you should be simple.

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