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Retail Credit Cards: Should you or Shouldn’t you?

Choosing Credit Card

Many of us, lured in by our favorite department store to carry a retail credit card, begin to second guess our decision to rely on our major credit cards for retail purchases. After all, retails stores offer such great incentives to use their cards, so why not take advantage of them?

The Pros of Retail Credit Cards

Make no doubt about it: there are plenty of benefits to carrying a retail credit card for stores that you frequent. For example, the store may include you as a “loyal” customer if you spend a certain amount of money there on an annual basis, thereby allowing you to become eligible for special promotions, coupons and shopping days.

If you are looking to rebuild your credit, a retail store is also a great place to start, as they are generally easier to get than a major credit card. If you need a way to rebuild your credit score then you may want to consider a retail credit card/

Finally, if you pay your bill on time, in full, each and every month, owning a retail credit card may be a great idea, as you won’t need to worry about the super-high interest rates often attached to retail credit cards.

The Cons of Retail Credit Cards

Even with all the benefits of owning a retail credit card, there may be just as many disadvantages to owning one.

For example, if you are unable to pay off your balance in full at the end of every month then you could be hit with exorbitant finance charges. And if you fail to make even one payment, your balance could quickly become unmanageable.

If you have difficulty controlling your spending then you may want to think twice about a retail credit card. For many of us, retail credit cards are often a green light for overspending. In fact, we often purchase many things we would have never purchased if we were paying cash for them.

As with anything else, you need to decide what type of credit card is best suited for you and your financial situation. For many individuals, one or two major credit cards are all they need to manage their spending. However, if you feel as if you need a retail credit card, make sure to carefully read and understand all of the card’s terms and conditions.

Credit Cards and Traveling: What you need to Know

Introduction

Many Americans turn to their credit cards when traveling, as they can provide a truly convenient and practical means of paying for everything from airline travel and hotels to restaurant meals and entertainment.

Best of all, credit cards, unlike cash, can be easily and quickly replaced if lost or stolen. It is no wonder, then, that so many credit card customers bring their credit cards along for the ride when they take a vacation. Credit cards, in fact, have all but replaced cash and travelers’ checks for traveling; their convenience simply can’t be beat!

Before you embark upon your next holiday, there are a few things you should take care of regarding your credit card:

• Contact your credit card company to check on your credit limit. If necessary, ask for a credit limit increase to handle all of the expenses associated with your travel plans. With the new credit card legislation credit card companies cannot charge you for over-the-limit fees, but they can decline your card if you exceed your credit limit. It is therefore important to make sure you have enough spending room on your credit card to handle all of your travel and vacation expenses.
• Bring along the contact information for your credit card and store it separately from your credit card in case your wallet or purse is lost or stolen. It is important to contact your credit card company immediately upon learning that your card is missing, so keep the phone number handy at all times so you can take care of business and get a new card issued and sent your way sooner than later.
• Consider bringing along a second card in case there are problems with your primary credit card. A second credit card is a bit like an insurance policy. If there are issues with your main credit card, you will still need a way to make purchases and cover expenses while away, so it is always best to have a backup credit card in your wallet, just in case.

Your Rights under the new Credit Card Legislation

News

You may be quite confused with the new CARD act. However, there are a number of benefits to this new credit card legislation that you should know about. Don’t let all of the language and confusing terms overwhelm you; just pay close attention to your credit card statement and educate yourself on all of the changes that are taking place, courtesy of the new credit card legislation.

• Your creditor can not raise the interest rate on your card unless you are more than 60 days past due. Even then, they must give you 45 days notice before they can raise your rate.
• Your creditor can no longer raise your interest rate because you were late on another bill. Before the credit card legislation went into effect, credit card companies could actually raise your interest rate if you were late on another payment, as they felt as if you were a greater credit risk.
• Your minimum monthly payment can change at the discretion of your creditor, so pay close attention to any changes regarding your credit card’s minimum payment.
• You must give your creditor permission to allow you to exceed your credit limit; otherwise, your credit card company cannot charge you an over-the-limit fee.
• Don’t expect to secure a credit card easily if you are under 21 years of age. Unless you can prove a steady income, expect to need a co-signer for your credit card if you are under 21.
• Your creditor must clearly outline how long it will take to pay off your credit card if you only continue to make the minimum payment. Many times, this type of disclosure can provide consumers with the knowledge to pay off their cards sooner than later.
• Your creditor must give you 45 days notice before they raise your interest rate. However, even with an increase in your interest rate, your creditor can only charge you the higher rate on future purchases, not on purchases made under your old interest rate.
• You still need to keep a close eye on your card’s fees and charges, as the new credit card legislation does not restrict how much creditors can charge for these fees.