Are Airline Credit Cards Worth It?
By · CommentsAirline credit cards are those that reward air travel points or miles to people who purchase items. People can easily redeem these points and miles. Airline credit cards ideally suit a specific user profile. Normally users of these credit cards travel regularly and are economically well off.
Ideal Credit Cards Checklist:
Airline credit cards generally have higher interest charges compared to ordinary cards. Thus, if people do not pay their credit charges on time, they will acquire a lot of interest. In addition, if you do not possess good credit ratings, you plummet into an elevated interest bracket. Thus, you will not be eligible for lower APR (Annual Percentage Rate) credit cards.
This makes airline cards extremely costly to own. It is also vital to pay other loans on a regular basis, since several rules connect your credit ratings across debts. This means that if a person possesses a bad credit rating in comparison to another owned credit card, it will definitely affect the credit rating in many airline credit cards. This will cause the person to pay higher rates of interest.
On the other hand, if you are not an extravagant spender and not spending much through airline credit cards, then you will not attain enough miles to take a trip by air for a very long time. Thus, if travel is not fascinating or not accompanying a person’s line of work, then it will better to get a small APR credit card.
However, if you do purchase airline credit cards, try using them whenever you go for shopping. Bear in mind to use the acquired airline miles at the first opportunity, you get. It is better to make use of airline miles for lengthy flights. Airline credit cards are best when people redeem them for airline miles. It is usually not worth it when a person redeems these credit cards on other products.
Airline credit cards differ largely in terms of their package of offerings. There are different credit requirements (if a person has a good credit) and varying APR’s. Additionally, some credit cards provide extra air miles. In such a case, there is a charge of different annual fees.
Bank sponsored airline credit cards enable a person to redeem air miles through several different airlines. With such sponsored cards, a person can use only the issuing airline. An informed purchase of these credit cards leads to free vacations for some and smart savings for others. Remember to merge the smart usage of these credit cards with informed purchase.
If an individual selects and uses airline credit cards intelligently the only downbeat effect will be a jet lag.
User Checklist:
Before deciding to go for airline credit cards, a person needs to make it a point to check the credit history. If it is almost perfect or faultless, you fulfill one want of the ideal airline-card user checklist. If you timely pay your credit card loan, you can strike off the second requirement of the checklist. It is also vital that debts on other bills and credit cards are paid one at a time.
winner’s circle by playing by these five credit card rules.
For some of my best tips on how to fix your credit report and score I’m listing a few of them below.
1. Get a copy of your absolutely free credit report instantly online – then make sure the information is correct. You can get your credit report for free online each year for all three credit bureaus – Equifax, Esperian and Trans Union. You’ll find the credit report easy to read. You’ll be able to determine which accounts are actually listed on your credit report and which are correctly listed. Check closely for any errors – go through again. Check all of your information so that you can be sure there are no errors. Any errors can be devastating to your FICO or credit score. Dispute and resolve any errors as soon as possible.
Free credit score? Your credit score at the time of this writing is not free. There is a small fee through credit report services. However you can usually talk a lender into giving it to you if you have applied for a loan or auto loan through a credit union, bank or other lender.
2. Make sure to pay your bills by the due date. This is one of the most important things you can do to improve your credit score. If you have paid any of your bills late, have had any of your accounts referred to a collection agency, or have declared bankruptcy in the past this credit history will show up on your credit report if its been in the past few years.
3. You can easily set up online automatic payments from your checking account to help you pay your bills on time. .Figure out the average minimum payment for each credit card you have. Make sure you have enough money in your account to avoid any bank charges or overdraft fees.
3. How much money do you owe now or in other words what is your outstanding debt? Many of the models used for scoring compare the amount of the debt you have to your credit limits. If the amount of your current debt is anywhere near your credit limit, it’s apt to have a bad effect on your credit score.
4. How long have you had a credit history? A short credit history may actually have a negative or bad effect on your credit score, but you can offset a short history with timely payments and low credit balances.
5. Have you applied for any new credit cards or loans recently? If you’ve applied for too many new credit card accounts or loans it may have a negative affect on your credit score (FICO) and credit history. These inquiries are always reported and affect the credit score whether you’re approved or not. However when you request a copy of your personal credit report, or any creditors are watching your accounts these inquiries are not counted as applications for credit.
6. What types of credit card accounts and other credit accounts do you have now? Many of the credit-scoring models take into consideration the number and type of credit accounts you have. A healthy mix of installment loans and credit cards may actually improve your score. But too many loan or finance company accounts or credit cards may hurt your credit score.
One secret tip – make sure to check your credit limits. If more than 50% of your total available credit limits are used you may want to know this tip. There is a little-known quick way to fix or increase your credit score and that is to bring down your debt ratio. You can try calling your credit card company and requesting a credit line increase. If you can get your credit line increased so that it makes your debt ratio less than 50% you may be able to increase your credit score by several points in next month’s report if it’s your only account. Of course you can try doing this with others too. You must keep in mind how much your total credit availability will affect your score also.
7. Be fully aware there are many credit-repair scams out there. The best way to repair your credit is to sit down and do it yourself. Use a credit repair ebook or other manual. It is actually pretty simple and involves only writing a simple dispute letter. You want to do this as soon as possible to remove any negative credit marks.
When following these best tips to fix your credit report and score and credit repair tips make sure to always do your best to take care of the credit you have and you’ll build a good credit history.
Why Credit Card Abuse Causes So Much Debt
By · CommentsCredit cards, when used properly, are convenient and a great budgeting tool. If abused, though, credit cards can be the start of a years-long nightmare and unbelievable stress. Most households that have credit cards have and use an average of eight cards.
First, let’s look at the cost of a credit card. If you sign up for a credit card and pay off the balance each month you’ll be building good credit and won’t pay any interest or fees on your purchases. If you’ve shopped around and found a card with no yearly fee, even better.
Carrying a balance, though, is very costly. Interest rates can be as high as 21% and by paying the minimum payment per month (usually about 2% of the balance) credit card companies are quite happy to loan you money for your purchases. Buying something such as a refrigerator on a standard credit card and paying the minimum payment can make that appliance very costly.
A $1200 refrigerator would result in a monthly minimal payment of $24. At that rate, it will take you nearly five years to clear the debt and interest and that appliance will have an actual cost of nearly $2,000! Your credit card might fulfill an emergency need but as you can see, it would be wise to either transfer that debt to a low or no interest credit card or pay it off as soon as possible.
The example of the refrigerator illustrates how consumers get into debt and stay there. Obviously, if you don’t have an emergency fund (and many of us don’t) you will have to depend on your credit cards if your car breaks down or unexpected necessary expenses arise. Paying off these balances should be one of the first priorities in the budget, both to avoid interest fees and to have that credit limit available.
Obviously, it’s best to pay your credit card balance in full every month. This will save you hundreds of dollars a year in interest charges and fees, as well as keeping the card clear in case you have a true emergency. The average cardholder has $9800 in credit card debt and pays only the minimum monthly payments. They pay nearly $1000 per year in interest on that debt. So how do you avoid becoming a statistic?
A smart credit card holder uses the card the same as cash when something is charged on the card, they subtract it from their checkbook register. At the end of the month, they can retrieve those entries and pay the balance on their credit cards. They’ve already marked the money as spent so they haven’t overextended their budget. The well informed consumer also knows his or her limitations; if they just can’t live without that bracelet or new suit, they’ll buy it but only after a cooling off period of a few days. These strategies help keep people out of debt and financially healthy.
With a little restraint and common sense, avoiding impulse purchasing and paying off your card balance in full each month, your credit score will stay healthy and so will your budget!
The Lowdown on the American Express IN:LA Card
By · CommentsWith many different credit cards offering alternate perks and benefits, credit card companies have become increasingly creative with their reward and incentive programs. Today, there are credit cards that cater to driving enthusiasts, food connoisseurs, music lovers and holiday makers to name a few specialties. Now, American Express has gone one step further with their IN:LA Card.
Specifically catered for people with good credit, the American Express IN:LA card is just one of the three American Express INSIDE Reward cards. Other cards in this product range include the IN:NY and IN:CHICAGO American Express cards.
The program awards one reward point for every dollar spent on general purchases. Purchases that include newspapers, magazine subscriptions, cable and dial-up ISP subscriptions, cell phone services and even movies and dining are aptly named ‘City Essentials’. For these purchases, double reward points are awarded. How fantastic is that? These points can then be redeemed for all kinds of benefits and experiences such as airline tickets, hotel stays and dining in Los Angeles, New York City or Chicago. The best part about these points is that they never expire and there are no yearly limits or maximum limits.
That’s not the end of it, though. American Express also offers members the Tuesdays IN:LA program, where cardholders are entitled to a 10% discount at selected retail outlets, spas and health clubs each Tuesday. What’s more, cardholders also enjoy the privilege of priority access and VIP room access at clubs along with lowered charges for museums and concerts. The card also has the standard gamut of benefits such as auto and travel insurance, fraud protection and the like.
While it may be the norm for us to expect some glaring disadvantages of a credit card that offers so many alluring benefits, this is not evident with the IN:LA Card from American Express. It is a surprise then that the interest rates are relatively low for a reward card with no annual fees charged. For the first six months of membership, there are no interest charges for purchases and balances transfers.
With all these perks, the American Express IN:LA Card is an ideal city-living credit card particularly for those who reside in Los Angeles.
So many different choices for credit cards: 0% APR credit cards, travel rewards credit cards, 0% balance transfer credit cards, and cash back credit cards. Selecting the right card for the way you use your credit card can mean a big difference in your pocketbook. Use this quick guide to help you spot the differences in your credit card offers:
Will you carry a balance every month or almost every month? If so, a lower interest rate is better for you. If you transfer a high balance credit card to a lower or 0% APR credit card (often an introductory period), you will save even more.
Will you be paying the credit card balance off every month? Then you will want to apply for a credit card without an annual fee. Finance charges may be higher, but since you pay the balance off every month, you won’t be charged. Look for credit cards that offer grace periods, usually between 25 to 30 days, before credit interest begins.
Will you be shopping for credit card balance transfer? Be sure to check out the transaction fees and the introductory periods. Occasionally your credit card company will offer you a credit card debt consolidation with convenience checks so that you can transfer one or more credit card balances, but be sure to check out the transfer guidelines.
Will you need cash advances? Apply for a credit card that offers a lower APR and lower transaction fees. Be sure to read the fine print on their requirements. Some credit card companies impose a transaction fee and a cash advance fee plus the interest rate. Some credit cards charge a higher rate for cash advances than regular purchases.
*Will you be traveling frequently, and charging your trip expenses? If this is your situation, then a cash back credit card reward program may suit you best. Be sure to consider your interest rate first, however. Rewards should come secondary to your spending habits and the cost of the credit card itself. Cash rebate cards offer you a cash back refund at the end of the year that you can use anyway you choose. Other credit card reward programs offer purchase points or redeemable rebates. Airline credit cards offer you miles as credit for every dollar you spend, sometimes offering you double or triple miles.
Whatever credit card offer you apply for, be sure to carefully consider the terms of your credit card, including the interest rate (APR), annual fees, transaction fees and balance transfer fees. Those hidden charges can add up quickly and cost you more than what you bargained for, so choose your credit card wisely.