Cash is scary. You have no protection if you lose it. It’s an easy target for theft. It gets damp and wadded up in your pocket, and if you forget to go through your pockets, it ends up going through the wash. Not to mention you’re almost always stuck carrying around three nickels until they either get thrown away, lost in the sofa or tossed into a change jar.
For many people, the answer has been to carry just a debit card. When you carry a debit card around, though, you’re really carrying around your entire checking account. You’re vulnerable to theft, fraud and other devastating consequences.
Carrying a credit card - and paying off your routine charges each month - can protect you from many of those troubles. In addition to being accepted just about anywhere, credit cards have fraud liability protection built into them. You’re only liable for a portion of the total loss. With a TCU Visa credit card, you will not be liable for any of the fraudulent activity on your account.
Compare that to a debit card, where a fraudster could use your number to clean out your checking account and hit you with overdraft fees. Like most financial institutions, TCU may be able to replace the money. But the process can take time, leaving you in hot water if you have automatic bill payments set up or major expenses like rent or a car payment due sooner than later.
Not only that, but carrying a credit card (and using it responsibly) can help build your credit score. Even having a card “for emergencies” can help provide you with peace of mind. There’s no security downside either. Every security feature in your debit card is also built into your credit card.
Knowing that a credit card is right for you doesn’t tell you which credit card is right for you, though. With so many of them out there, it can be difficult to sort out what’s relevant from a sales pitch. Here are a few important points to focus on when considering your options:
No annual fee
The convenience of a credit card makes it a fantastic option, but it’s hard to justify paying a ton for it. Annual fees can sometimes be as high as $500. These are charged automatically to your card. If you’re not paying attention, they can put you over your credit limit or leave you with a balance and unexpected payment coming due. Apply for a TCU credit card to avoid these risks, as there are no annual fees.
If your card does have an annual fee, there are several ways you may be able to get out of it. Some cards will waive the annual fee if you charge a certain amount each year. Others may let you out of paying the fee if you call and threaten to cancel. Of course, choosing a card with no annual fee is the best first option.
Conventional wisdom says you should choose a card that offers a competitive rewards program, such as the TCU Signature Rewards credit card. That way, you can charge everything to that card and maximize your rewards potential. If you pay off the balance in full each month, you get all of the upside without the interest charges.
Rewards programs are nice, but they shouldn’t be the only deciding factor in picking your credit card. One reason being, seeing an expiration date on your rewards points could encourage you to splurge so that you can rack up points and have more to cash out. Unfortunately, racking up those extra points also racks up additional debt on your card. This can be risky, because if you become unable to consistently pay off your card’s balance in full every month, you could be staring down a significant finance charge. A healthier approach is to treat your rewards like a bonus, but don’t plan your financial habits around them.
Low financing fees
This is the most important factor in choosing a credit card, since you want to find the lowest cost for your credit services. Two main factors influence the fees you’ll pay:
- Grace period – This is the time between a charge and interest accumulation. On average, it’s between 28 and 30 days. This gives you time to pay the balance without being charged any interest.
- APR is the interest rate, or the percentage of the balance that will be added to your bill each month. Because credit cards are considered “unsecured credit,” the rate can be pretty steep compared to other types of loans. But you can keep it low by paying your credit card off in full each month.
Long story short: Shop around for a credit card that gives you time to pay it off before charging interest and offers a low interest rate for those times when you need to carry a balance.
And as long as you’re shopping, consider a TCU credit card. Our Visa Platinum and Signature Rewards cards currently offer 0% APR* through November 2022 on purchases and balance transfers posted between now and Jan. 31, 2022.
While there are a lot of credit cards out there, TCU offers a simple credit card program that features 28-day grace periods and introductory interest rates as low as 0% APR*. Call, stop by or apply online for a TCU credit card and start enjoying convenience and security with a local credit union you know and trust.