Nowadays, consumers are inundated with credit card offers from what seems like an infinite number of companies. However, learning everything there is to know about any credit card won’t be necessary. Knowing the type of credit card that will meet your needs will let you focus on researching individual cards within that category.
Extra points in rotating categories like groceries, gas, and dining out are offered by several rewards credit cards. You may redeem your rewards for statement credits, gift cards, or even merchandise with many rewards credit cards. Therefore, you can confidently use one of these credit cards for everyday expenditures that don’t necessitate a 0% interest promotional period. Using a credit card with a rewards program might help you save money or get free flights and hotels on things you need anyway, like food and household items.
Different cash-back credit cards have different reward structures, with some offering a flat percentage rebate on all purchases and others offering more complex rewards. There are a variety of reward schemes to choose from in this market, including flat rates and bonus points for spending in specific categories, such as restaurants and travel. Some cards also offer a fixed rate of points on all purchases outside of the bonus categories, which change every three months.
There are also numerous no-annual-fee credit cards that offer cash-back rewards. Some cards with more generous rewards and perks do, however, impose a nominal annual fee (often less than $100). If you spend more than average on groceries or dining out, for example, you may be eligible for a bonus subcategory card rather than a general-purpose credit card.
You can earn incentives that are specific to your travel needs with a travel rewards credit card, such as points that can be transferred to airline or hotel loyalty programs or flexible trip credits that can be used on any travel purchase. Some travel credit cards allow you to accrue points for specific loyalty programs, such as frequent flyer miles or hotel stays.
If you travel frequently for business or pleasure, it may be worthwhile to keep an eye out for premium credit cards that offer travel perks such as access to airport lounges, annual travel credits, and the ability to have application costs for expedited security programs like Global Entry and TSA PreCheck waived. You don’t even have to leave the city to start accruing points and miles; several of the best travel rewards credit cards allow you to do so simply by making routine, non-travel-related transactions.
In order to consolidate high-interest credit card debt, you may be considering a balance transfer credit card. The best balance transfer credit cards offer an introductory 0% APR period of 15–21 months, giving you plenty of time to focus on making principal payments without accruing any interest charges.
Some credit cards don’t have a balance transfer fee, but the average fee is 3–5% of the transferred amount. Transferring balances to your card during the promotional APR period could save you money on interest, despite the balance transfer fee.
Users can separate business and personal expenses with a business credit card and get rewards on all company expenditures. There is a vast variety of corporate credit cards available, from those that offer cash back and other specific benefits to those that offer travel bonuses and even secured lines of credit. You need a legitimate business or other reliable means of income to be considered for a business credit card.
If you can pay for all of your company’s expenses with one credit card and save money while doing so, you have a great business credit card. Look for a credit card that helps you save money in several ways, such as through a generous rewards program, detailed expenditure records, or some other means. Some business credit cards offer a flat rewards rate on all purchases, while others provide greater advantages on expenditure categories that are especially vital to a business, such as travel and internet access. Most business credit cards offer a choice between cash back and airline miles as redemption options for incentives.
Credit cards for students are a special form of “starter credit card” for those with no or limited credit history. In other words, it’s more probable that you’ll be accepted if you apply because the requirements are less stringent. Most student credit cards don’t charge an annual fee and provide discounts and cash back for good grades and responsible spending. When a student signs up for a credit card and uses it responsibly, it can help them get on the path to building a good credit history and healthy money habits.
The term “co-branded” is used to describe store credit cards issued by larger financial institutions like Chase, Citi, and American Express. Credit cards offered by airlines that let you earn miles in a specific frequent flyer program or hotel credit cards that let you earn points in a certain loyalty program are two examples. Co-branded credit cards are issued by some retail partners and can be used anywhere Visa is accepted. While co-branded credit cards may only provide perks for a single company, those perks are typically substantial and superior to cash back in many situations.
Customers can apply for store credit and make monthly payments for in-store purchases. Although it is more of an exception than a rule, some store credit cards can be used at other stores in the same retail chain. Credit cards issued by retailers typically have higher interest rates than credit cards issued for other purposes, and they frequently charge interest retroactively. Deferred interest arrangements often offer a low or 0% introductory rate, but interest will accrue on any outstanding principal from the deferral date forward. Making on-time payments, however, might earn you rewards and discounts with a store credit card.
Credit cards typically don’t necessitate a security deposit. With a secured credit card, you put down an equal amount of money as collateral for a lower credit limit. Applying for a secured credit card and depositing $500 would get you a $500 credit limit, for instance. A minimum initial deposit of $49 is required to establish credit. If you need to begin developing credit from scratch or rebuild your credit after an economic setback, you may find that a secured credit card, which requires you to put up collateral in case you don’t make your payments, is the easiest type of credit card to be accepted.
For the first 12 to 18 months, you can make any purchase on most credit cards without paying interest. If you plan to make a sizable purchase and pay for it over time, one of these credit cards could be useful. Low-interest credit cards have interest rates that are consistently lower than the market average, not just during special promotions.