Did you know that credit cards are used by 183 million people in the United States?
If you are planning to use credit cards, there are many types to choose from. When you find the right one, build an excellent credit history.
Also, using the right credit card can save you money! If you sign up for credit cards and use them responsibly, you can build a credit history with many benefits.
However, you should know the different types of credit cards before deciding. Keep reading to learn more!
1. Rewards Cards
Rewards cards typically offer generous rewards such as cash back, travel, and points with select vendors. Some rewards cards offer sign-up bonuses or introductory periods with great bonus points. With rewards cards, the more a person uses them, the more reward points they can accumulate.
These points can then be redeemed for rewards such as cash, travel, and select vendor products. Rewards cards also have incentives like extended warranty and purchase protection plans. Interest rates and annual fees depend on the issuer, so compare offers to find the best card.
2. Balance Transfer Cards
They are specifically designed to help people manage their debt. This allows them to transfer the balances on other credit cards to a new balance transfer card with a lower interest rate or even a temporary no-interest rate. This will enable people to pay off their debt faster as the interest rate decreases.
Customers with good to excellent credit scores are usually eligible for balance transfer cards, though each lender’s requirements may vary. In addition, balance transfer fees generally apply, which are typically around 3-5% of the amount transferred.
Ultimately, balance transfer cards can be a great way to save money on debt and reduce the amount of time it takes you to pay off your debt.
3. Student Cards
These cards typically have low credit limits and higher interest rates, although some student cards offer promotional rates, rewards programs, and other perks. Students can take advantage of these cards to build their credit history.
Student cards can offer a safer way to establish and build their creditworthiness. They can also be a way to develop financial independence while they are in school.
Student cards may also come with additional features, such as increased credit limits after the student has demonstrated responsible credit use. Student credit cards can be an excellent way to start building a credit history, but they should still be used responsibly.
4. Business Credit Cards
Business credit cards are a popular option for businesses and offer a range of rewards for their customers. These cards provide convenience, access to cash, and opportunities for building a credit history. Business credit cards can be used for travel, purchasing office supplies, and entertainment.
Business owners benefit from more control and flexibility when financing their business activities. The proper selection can help owners reduce costs and secure more funding for their capital projects and operations.
You can also visit Nav to learn more about business credit cards that are right for you!
Understanding the Types of Credit Cards
In conclusion, many different types of credit cards fit your lifestyle needs. It is essential to do your research to find the credit card that is best suited for you, whether that be a rewards card, a secured card, or a store credit card.
Take the time to explore your options and understand what’s best for your financial situation.
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