Are you thinking of opening a new credit card but not sure which one is the best fit for you? The sheer number of credit card options and all the perks, advantages, and disadvantages of each one can become overwhelming. At Andrews Federal Credit Union, we know how important it is to understand and consider different elements before selecting the specific type of card that best fits your lifestyle, goals, and budget. Think of your credit card as a bridge, built with pillars that include approval rates, APRs, rewards, points, cash back, and more. Let’s delve into the array of credit card choices available, for you to cross that bridge and reach your destination of good credit.
Understanding Credit Card Terms
Making sense of the credit card's “terms and conditions” is the key to choosing the card for you. Even if this is not the first credit card you apply for, it is essential to be well-versed in credit card lingo and what they entail, as this will affect your payments, fees, and more. From there, you can concentrate on what you want your credit card to do for you.
Approval rates
Approval rates refer to the percentage of submitted credit card applications that are approved by a financial institution. Your credit score is often the deciding factor for approval, which you can easily find using Credit Karma or logging into Andrews Federal Credit Union’s online banking.
APR
APR stands for annual percentage rate, which translates to the interest amount charged on outstanding balances you have, plus any fees that may apply. Setting up automatic online payments using your mobile banking app can aid in avoiding hefty interest payments. Find out more about Andrews Federal Credit Union’s new Supreme Rewards Visa Signature® Credit Card and our credit card interest rates here.
Introductory APR
With a new card, there is often a grace period for several months, where no charge will apply if a credit card payment is missed. It is of the utmost importance to get in the habit of paying off your balance every month and avoiding late payments.
Annual fee
Some credit cards have an annual fee in exchange for benefits and rewards. You will need to determine if the annual fee will pay for itself with the benefits and rewards you receive.
Credit limit
A credit limit means the maximum amount you can spend using your credit card. Credit Karma recommends paying off your balance at less than 30% of your credit limit to help increase your credit score.
The Benefits of a Rewards Credit Card
Rewards credit cards often include an annual fee but provide benefits like travel points, gift cards, and more.
Put it in perspective: With no annual fee, you can earn up to 4x points on streaming, gaming, and entertainment purchases when you open a Supreme Rewards Visa Signature® Credit Card.
Does a Cash Back Credit Card Make Sense for You?
A cash-back credit card is perfect for those who want more value from their spending. Cash earned can be transferred back into your checking or savings account.
Put it in perspective: When you spend $1,500 in the first 90 days of opening your Titanium Rewards Visa® Signature Credit Card, you will earn 10,000 bonus points.
Why a Secured Credit Card Might Benefit You
Secured credit cards are optimal for those who want to increase their credit and decrease debt. The credit card is backed by a deposit from the cardholder.
Put it in perspective: With a $500 security deposit, you can build credit while earning rewards with our Platinum Rewards Secured Visa® Card.
How a Low-Rate Credit Card Can Save You Money
A low-rate credit card can help manage expenses while minimizing interest costs.
Put it in perspective: Our Supreme Visa Credit Card allows you to save with a 0% APR* introductory rate for 6 months on purchases made within the first 90 days.
Conclusion
Choosing a credit card is an important process. Staying aware of details can be beneficial in making that decision and can provide a bounty of benefits if you hold yourself accountable with payments.
Looking to open a credit card? Contact us online or visit one of our conveniently located branches in Maryland, Virginia, Washington, D.C., New Jersey, and beyond.