Credit Card Features
What credit card features are most important to be aware of and uses when comparing credit cards? It’s a brilliant question that we feel deserves a lot of attention.
We already know how popular credit cards are, but little do we really know about credit card features and how they can impact us in a day-to-day scenario. Especially if we fail to comprehend our responsibilities and the terms attached to the card we choose.
Every day, millions of households worldwide get bombarded with yet another offer to join credit card scheme X. This in itself is overly tempting for many consumers. To get a credit card basically ‘thrown’ at you’ is hard to resist. It’s kind of like free money – ready to spend – until the bill arrives weeks later. Our credit card features article digs deeper into the world of credit cards and shows you what to look for and what to expect when dealing with credit cards.
Is there a honeymoon period?
A lot of card providers offer you a honeymoon period during which you can use your credit card fee-free with little or no interest payable. Depending on the card provider these terms range widely and you are well advised to study the fine print before you rush off with your new card.
While a ‘honeymoon’ can save you a bit of money, these are often limited to a set amount of time after which the card becomes actually VERY expensive if not handled properly.
What is the yearly credit card fee?
Most credit cards attract a yearly fee. Some will cost dozens of dollars while others can be as expensive as hundreds of dollars. This always depends on the extras given to you as the credit card holder, things such as insurance cover, services and more.
Australian mortgage holders with a ‘mortgage package’ can qualify for a cost-free credit card. To find out more about this, you should contact your bank.
Other fees and charges.
After paying your yearly credit card fee, common credit card features also include interest fees and other charges. You could be paying dearly for using your credit card on an ATM or by overdrawing your account. The best way to avoid those extra charges is by paying off your card each month and never use them to cash money from an ATM.
How many interest-free days will you be given?
Interest-free days credit cards are ideal for consumers who plan on paying off their card in full each month. By delaying your payment for another 55-days as is usually standard, your money can work for you on your savings account or even better, in yourmortgage offset account.
Just be wary of cash advances as these are not included within these interest-free terms.
Is the credit card linked to a rewards program?
Unless you take full advantage of these schemes they will be costly. A lot of rewards scheme credit cards attract a higher annual fee and a higher interest rate to start with.
Are there any other incentives for you?
Because of the general decline in the value rewards schemes offer you, incentives have become popular in recent times. These can be given to you in the form of vouchers, instant savings with bulk offers, extended warranties, frequent flyer points or more.
The benefits and pitfalls of balance transfers.
If you have a lot of existing credit card debt then you can most likely benefit from a balance transfer credit card. The low interest rates given will allow you to pay off your existing debt before the ‘honeymoon period’ is up – usually six months.
Can you get a second card for your partner?
Most credit card companies will offer you an additional card at a reduced rate or even cost-free. Extra cards are great if you trust the other person. They will make you accountable for the ‘other account’ so be sure to understand your responsibilities and the terms and conditions before you apply for a second card.
Be wary of store cards!
Many shops will offer you one of their store cards these days. Many of them will function like a credit card, but they do have very high interest rates. Be very careful to use them and abuse them as this will cost you dearly.
Choosing the best credit card features for you!
If you want to be absolutely assured you are getting the best deal, then you need to look at all credit card features from all major providers to be able to make an informed decision. Doing so will not only save you money, but prevent you from ending up with the wrong card.
We have compiled a series of articles that address the various important Credit Card Features and what they mean to you:
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