You’re looking for a new credit card, but you’ve just realized how many credit card options are out there. Choosing a credit card is a tough decision. If you choose the wrong card, you could be stuck paying high interest, a ton of fees, and basically waste a lot of money on a card that’s hurting you as much as it is helping.
Before you take the plunge with a credit card, you may want to consider the following: compare different options for credit cards; figure out what your financial needs are; don’t waste time looking at cards that won’t work for you; and don’t forget to include the credit cards offered by your local credit unions in Utah. A card from your local Utah credit union may sometimes be the better option.
Choose a Card Type
You might think a credit card is a credit card. Straightforward and simple. Well, that isn’t always the case. There are actually various credit card types. Some are set up to help people pay off debts, or some are backed with cash that have limits.
Though many card types are out there to choose from, the two most common card options you’ll find at credit unions in Utah are balance transfer cards and rewards cards.
Balance transfer credit cards allow you to take existing credit card debt, shift it to the new card, and pay it off at a new and hopefully lower interest rate. Your old debt isn’t eliminated, but you save money in the long run when you pay a lower interest rate. Some credit unions in Utah charge a fee for the balance transfer, but others, like Deseret First Credit Union in Utah, don’t charge that fee. So keep an eye out for extra fees that you might be able to avoid.
Rewards credit cards are basically what the name says. As you use these cards, you earn points, and when you’ve collected enough points, you can redeem them for various rewards. The rewards vary depending on the card provider, but it’s common for rewards to range from small purchases to vacations to charitable donations.
Once you’ve determined which card type you need, you’ll be on the right track. However, there are a few more things to consider.
What’s the APR?
After the card type, the APR, annual percentage rate, is the most important thing for you to consider before applying for a credit card. This interest rate will determine how much you are paying each month on your debt.
If you have a high rate on your credit card, you’ll pay a lot more per month than you will if you have a lower rate. Pretty straightforward, right?
That being said, credit card rates are typically a little high, so don’t expect to see any rate much lower than about 9%. Rewards credit cards often have a higher APR than balance transfer cards, so keep that in mind if you are considering a rewards card.
Aside from the APR itself, you also need to check if the card is a fixed-rate or variable-rate card. Fixed-rate means that once your card’s APR is set, it can’t change as long as you have the card. This can be nice because you’ll always know the percentage of interest you’ll be paying on your credit debt. It can mean, however, that you’re paying higher interest than other people if the market interest rate drops.
A variable-rate card can change its APR with the market every few months. This can be a good or bad thing for you. The rate could be quite low at times, but it could also end up really high at times too. It’s a bit unpredictable, but it can save you some money when the rates are low.
Compare the possible APRs carefully before applying for a card. If you have questions about what a good APR might be, check with one of the credit unions in Utah for help or see how their credit card APRs compare with others in the industry.
Look for Grace
Sometimes finances are tough. You might find yourself in a month where you can’t pay off your card debt exactly on time, or you just lost track of the time and forgot to pay on time.
Whatever happened, you don’t want to find yourself with a mountain of late fees because you missed your payment by a couple of days. So something you want to know is how long the grace period is for your credit card.
If the grace period is short or non-existent, and it’s likely that you’ll be a little late on payments sometimes, try to stay away from those cards. Instead, you should look for cards with more cushion after the due date.
For example, Deseret First Credit Union in Utah offers a 30-day grace period for both of the credit cards they offer. This kind of grace period would give you plenty of time to make up the payments.
Make sure you check the fine print on the grace periods as well. Sometimes the grace periods only apply to certain kinds of credit debt and not others.
Reward Yourself
If you choose a rewards credit card, you’ll probably love the rewards you can redeem. You’ll love it more if you know how the rewards program is set up for your credit card.
Rewards programs can vary a lot. You may be able to redeem your points for cash, travel, sporting events, charities, and who knows what else. This can really save you a lot of money on those kinds of purchases.
But the variation in rewards programs isn’t just the types of rewards, it’s also in the fine print. You should always look over the fine print for any credit card you apply for, but this is especially true for rewards credit cards.
When you read over the fine print, you’ll learn how the rewards program works. You’ll figure out where you can actually earn points, if you can earn extra points for some purchases, and how much the points are worth (hint: even if you earn 1 point for every $1.00 spent, the point is not worth $1.00).
So learn about the rewards programs. Many credit unions in Utah will give you a general run-down of their program on their websites. You may want to start there and then move on to the fine print in the application.
Rewards credit cards can pay off and get you great rewards. Just make sure you understand the program before you jump into it so you know how it can benefit you best.
Security
As common as credit card theft is these days, it’s surprising that this isn’t talked about more when comparing credit cards. The security features of your credit card can be a huge help and protection to you.
If a credit card provider is good, they’ll offer their customers ways to easily track their credit card transactions, to receive alerts about suspicious transactions, and to freeze their card if they find suspicious spending. These are just the basic security measures that a good provider will offer.
Some providers will offer other security measures such as spending limits, geographic limits (so the card can only be used in certain locations), and location matching.
Of course, none of these measures is 100% guaranteed to protect your credit card from theft, but they can certainly help give several layers of protection to make theft much less likely to occur.
Take the security of your card seriously. If a credit card seems to have the perfect APR, grace periods, and rewards but doesn’t offer good security, you may want to reconsider whether it’s a good option. Little or no security for your credit card leaves you open to the threat of theft, so don’t choose a card that won’t be protected.
DFCU Credit Cards
Deseret First Credit Union in Utah offers two fixed-rate credit cards to its members, a VISA Platinum and a VISA Platinum Rewards card. Each card offers low starting APRs to help you save money.
With no annual or balance transfer fees and a 30-day grace period, these cards are competitive in the industry to give you the best care possible. To give your card extra security, you can set up the CardHub app for your mobile banking.
Learn more about Deseret First Credit Union’s credit cards here, and apply today to start saving money on your credit card debt.