Why Discover Credit Cards with Financer.com
Financer.com has always prided itself on our longterm vision of service to our visitors.
Because of this, we look for credit cards that are most advantageous for consumers in general when it comes to staying out of debt. Take a look at our offers above and compare to see which offer is the best fit for you.
How Credit Cards Play a Key Role in Financial Success
Credit cards play a central role in all commerce, as they are convenient substitutes for cash or check. A credit card is not only easier to carry than cash, but it is also safer because of fraud protections if your card gets lost or stolen. That’s something you can’t say about cash — once it’s gone, it’s gone for good.
A credit card can sometimes seem like free money, so it’s best to take some time to learn how to use it wisely so you don’t fall into deep debt.
How Do Credit Cards Affect Your Credit Score?
The average American carries about 4 credit cards, however, this doesn’t mean that four credit cards are ideal.
In fact, you might be very surprised to learn that you technically need to have 21 lines of credit open to hit the perfect 850 FICO score.
In a lot of cases, opening a new credit card can actually boost your current FICO score overall, some more than others.
For example, you might have a low 600 right now but only have one credit card that has $2,000 of credit on it. By opening a second card with an $8,000 limit on it, you might see your score shoot up by 80+ points on your FICO reports.
The reason for this is broad but in a nutshell, if you can show creditors that you can successfully manage large lines of credit by staying under 10% of total utilization- this behavior is viewed as a positive to other lenders who are willing to now work with you more because of your positive relationship with managing money.
Lastly to dispell a quick common myth in regards to credit cards; although generally speaking, a credit card from a lender will cause a hard inquiry which might negatively impact your credit score by 1-4 points, for the general population the upside HEAVILY outweighs the downside.
Approval means access to more credit which means a higher credit score overall- and typically people don’t notice too much of a hit to their credit score if they are applying for 1 new card every 4 months or so.
If you do notice a large hit to your credit score, you can generally just wait about 1-3 months and notice a large recover in your score overall- sometimes a large dip in your score is caused because it can appear to the credit bureaus like you’re teeing up all these new credit cards to do something potentially highly risky.
How to Use Your Credit Card
Credit cards are so convenient because they are accepted virtually everywhere and don’t require hitting the ATM or carrying around cash. Just swipe your card or insert the chip in the card reader, and you’re on your way. But this swipe-and-go process can also lead you down a dark path of interest-bearing debt.
Using Your Credit Cards Responsibly
Credit cards can be amazing when you use them correctly. They can earn you free vacations and cash back, but they can also open a pit of debt that can throw your financial situation for a loop. Here’s how to use them responsibly:
- Spend within your means. Banks will occasionally call and offer higher lending amounts based on your income and credit card payment history. Make sure you are still leaving within your means even if you have a higher limit.
- Never buy anything with a credit card that you do not have the cash to pay for.
- Compare credit card offers often and focus on those with o% interest and reward points. Once you have opened an account, you don’t have to keep it.
- Always pay your credit card in full when you receive your statement
How a Credit Card Can Benefit You
- Convenience: With a credit card in your wallet, you rarely ever need cash or an ATM.
- Efficient record keeping: Easy expense monitoring and monthly budgeting through monthly statements.
- Instant cash: You can get quick cash advances when you need them, instead of applying for personal loans.
- Purchase protection: Credit cards often offer extended warranties on items you purchase.
- Balance surfing: You can quickly transfer your high-interest balance to a lower-interest card.
- Perks: Credit card holders often earn reward points for using their credit cards, which they can redeem on travel, cash back and more.
What to Consider Before Getting a Credit Card
A credit card can be useful and destructive, so before you compare credit card offers, ask yourself these questions:
- Can you limit use to just your daily expenses?
- Are you committed to paying your credit card off each month to avoid interest charges?
- If it’s a variable-rate card, can you afford the constant interest rate fluctuations?
- What credit limit do you need? Use the calculator at Financer.com to compare 11 lenders limits.
What You Should Know About Credit Cards Rates, Fees and Penalties
Card issuers often find subtle ways to take money from you. Balance transfers and cash advances, while attractive up front, include fees. Some companies even charge a yearly fee just for having the card.
These fees are part of what allow credit card companies to offer these types of deals. Make sure you weigh out all your options before taking advantage of these and other offers.
You also need to take penalties into consideration when shopping for a credit card. Late on your payment? There’s a penalty. Go over your limit? There’s another penalty. Each credit card has different penalties, so make sure to review these on the off chance you run into one.
How to Find The Best Credit Card Rates
Credit card rates can vary greatly between issuers, and the only way to find the best one for you is to shop around. But don’t search at random. Instead, write down a list of what you need in a credit card and put them in order of importance.
This will help you whittle down the massive list of available credit cards to just a few that offer the best benefits for your situation and help you learn how to compare credit cards.
Here are some of the rates to consider when shopping for a credit card:
- Promotional interest rate
- Fixed interest rate
- Foreign transaction rates
- Balance transfer rates
How Can You Lower the Interest Rate on Your Card?
Since you agreed to the credit card terms, you may have a hard time getting the issuing bank to reduce the interest, but it’s not impossible. Here are a few tips to help drop that interest rate:
- Call your lender and ask for a lower rate.
- Search for new-customer deals for your card and request that rate.
- If all else fails, sign up for a new card with a lower rate and transfer the balance.
Always remember that credit cards are like any other financial service: Everything is negotiable. Don’t be afraid to call your credit card company and ask them to lower your interest or waive an annual fee.
The worst the company can say is “no.” But if you have a steady payment history and have been a customer for a few years, you may be surprised at what you can ask for and receive.
