Why do I need to compare credit cards?
Everyone has a unique need which may differ from the need of others. Comparing credit cards will help you to get the right card that will meet your exact needs. Since needs differ, there is hardly a one-size fit all credit card. The credit card you should opt for will depend on several factors such as the amount of spending you intend to do with the card, the amount of money you make, the reward and features you seek and many more. For instance, a reward card may be adequate for you if you spend $2000 each month on your card and pay it off per month. However, you should consider a no-fee or low interest credit card if you have a limited income or you may probably not be able to pay off your balance each month. Interestingly, Ratehub.ca provides different types of credit cards for you. You can start by entering your spending to get the card that would suit your needs.
What is credit card interest? How does it work?
Interests on credit cards are charged on your credit card amount if you fail to pay off your balance in full before the stated due date per month on your credit card statement. Usually, the interest is charged on the entire credit card balance, not just the amount left unpaid. For instance, if your credit card balance is $1,000 and you paid off $999 before the due date, you will still be charged an interest on the full credit card balance of $1000, not just the $1 left unpaid. The typical credit card interest is $19.99% for purchases. Due to the accruement of interest on a credit card, it is advisable to use your credit card when you are sure you can pay back the credit card amount fully. This will help you to avoid penalties and high interest rates.
How do secured credit cards work?
Secured credit cards are simply credit cards that are backed by a security deposit in much the same way that loans are often backed by some other assets. To obtain a secured credit card, you need to deposit a stated amount of money with the card issuer. In most cases, the amount required is 1 or 2 times the available credit limit. For instance, if you need a secured credit card with a limit of $1,000, you may need to deposit about $1000 – $2000. This deposit will keep the issuer protected in case you are unable to pay your bill.
What is the need for credit card annual fees?
Annual fees are fees paid by credit card users for the privilege of having the card. A credit card user is required to pay annual fees before he can receive the rewards that go with the card. In most cases, annual fees on credit cards could range from $20 to $120 but in some cases, they could also be as high as $399. A credit card with high annual fee will attract a greater reward than one with a low annual fee. The reward programs often attached to credit cards include cash back, travel, and gas savings.
When should I consider rewards credit card?
A rewards credit card could offer you great and exceptional rewards if you meet its requirements. However, this credit card is best for you if you are sure to pay off your full credit card balance before the designated due date for payment and also use the card responsibly. You should also be mindful of the annual fee and you should know how to determine or evaluate the reward points on your credit card’s rewards programs. However, the rewards you could obtain on the credit card may make the annual fees to seem insignificant. This is usually the case if you spend enough money. On the other hand, the reward credit card may not be best for you if you probably do not value the rewards, or you do not plan to use your card often. In such a case, you should consider going for a credit card with no annual fee such as a no-fee credit card. You can even find some no-fee credit cards offering some rewards.
How does a business credit card work?
Business credit cards are much like personal credit cards. However, they are designed to help you to improve your business remarkably. Business credit cards can be used to pay off business expenses easily and also manage your business expenditures seamlessly. The credit card makes bookkeeping and accounting easier since you will be able to pay for every business expenses with just one card. In addition, with the right business credit card, you will have the funds you require to finance new projects, handle unexpected costs, and pay off business expenses. Interestingly, virtually all the terms and conditions applicable to a personal credit card is also applicable for a business credit card.
How do I qualify for a business credit card?
Whether you are a sole proprietor or have a business, you can apply for a business credit card. In most cases, your potential lender will require that you provide a proof that your business exists to get a business credit card. The proof could be in the form of documents like your business license, tax assessments, partnership agreement, articles of incorporation, and/or financial statements. Sole proprietors whose businesses are not incorporated but operate the business under their own names may still qualify for a business credit card.
How do balance transfer credit cards work?
Balance transfer credit cards are cards that offer remarkably low interest rates, in some cases, 0%. The low interest rate is intended to encourage people with credit card debt to transfer their card to another card. Usually, the low interest on balance transfer credit cards could be available for a short period of time – may be 180 days, 10 months, 1 year and so forth – and are intended to lure new customers who would likely continue using the card even after the promotional period.
What is a low interest credit card?
A low interest credit card is exactly as its name implies; it is just like any regular credit card but has a lower interest rate. The interest rate on this credit card could be as low as 5-10% which is obviously low compared to the 19.99%+ of usual credit cards. Furthermore, low interest rate cards have lower interests on both balance transfers and cash advances. This may mean a great deal to you if those transactions are important to you. Usually, low interest credit cards may have a low or no annual fee. This makes it accessible to everyone irrespective of their income.
What is the most appropriate time to use a low interest credit card?
Low interest credit cards are not only relevant for carrying a balance on your credit card, they are equally helpful for making purchases on a daily basis or for emergency expenses. Furthermore, a low interest credit card allows you to pay lower interest than you would with regular credit cards and you can also use the credit card anytime you want. Although we do not recommend getting cash advances, low interest credit cards charge lower fees on cash advances than other cards. In addition, low interest credit cards are often used for balance transfers. A lot of people make use of low interest credit cards to transfer their balances from a card to a new one with low interest. This transfer makes it possible for them to have only one monthly payment which, of course, has a lower interest rate.
Why Do I need a Rewards Credit Card?
If you frequently use credit cards to pay for your daily purchases each month, you might find a rewards credit card an excellent option as it enables you to earn some mouthwatering benefits for each purchase you make. The points you earn for each purchase you make with a reward credit card could be redeemed for hotel rooms, flight, cashback and so forth. One important precaution to take when using reward credit card is to pay off your balance in full every month. This will help you to avoid interest charges and ultimately get more out of your purchases each day.
What types of rewards do we have?
You can earn several types of rewards but perhaps the most common are free gas, travel points, cash back and store points. These reward types are exactly as their names imply. With travel rewards credit cards you will earn travel points for each purchase you make. This point accumulates and can be redeemed to purchase hotel stays or plane tickets. Cash back credit card gives you the opportunity to get back part of your money on your purchases, usually about 0.75 – 4.00%. This amount could be sent as a cheque in the mail or applied to your statement. With store credit cards, you can earn points that are redeemable for goods in stores. Gas credit card earns you free money that can be used to purchase gas at specified gas stations.
Furthermore, insurance products could be included in some rewards credit cards. Examples include travel medical insurance, interruption insurance, trip cancellation, damage insurance, and rental car collision. The added insurance does not come with any additional cost and would become invaluable in the event of unforeseen events or accident.
Why is Annual Fee included in Most Rewards Cards?
Annual fees are simply fees paid by the cardholder for the privilege of using a credit card and gaining its benefits. In some cases, the annual fee could be very high but you use the card often, you may earn a lot of rewards that would outweigh the cost of holding the card. It could be better to go for a no-fee credit card with fewer rewards if you do not use your credit card often or will not redeem the reward points.
What Does a No-Fee Credit Card Mean?
Simply put, unlike some other credit cards that require the cardholder to pay an annual fee (usually in the range of $99-120), a no-fee credit card does not require an annual fee. As a result of this zero annual fee, no-fee credit cards may have very little or no rewards.
Why Do I Need a No-Fee Credit Card?
No fee credit cards do not involve an annual fee. You will do not use credit cards often but still want to build an excellent credit history and pay for online purchases with ease, then a no-fee credit card is for you. It makes no sense to pay a lot of money for something you will not use or will not earn rewards from, no-fee credit cards ensures this for you.
Are there No-Fee Credit Cards in Canada that offer Rewards?
Some no-fee credit cards offer rewards. But as you can expect, the value of the reward points is usually a lot lower than the usual rewards credit cards. This means that you may take a long time to earn something significant, especially if you do not use your card often.
Why Do I Need a Travel Credit Card?
Travel rewards credit card could be a cost saver if you love to travel and prefer to use your credit card to pay for your daily purchases. Depending on the card you choose, you will earn travel points for each amount you spend. The points can be redeemed for bus and ferry fares, hotel stays, flights, ski rentals, taxi fares, airport parking, baggage charging and so forth.
Travel rewards cards usually come with bonuses in the form of insurance policies. On redeeming your reward points by booking for a trip, the card could also include trip cancellation and trip interruption insurance, complimentary travel medical insurance, collision and damage insurance for rental cars and flight delay and baggage coverage.
How Do I Redeem the Travel Points I Get?
You can redeem your reward points in various ways such as using the points or miles to make purchases directly or exchanging them for some dollar value of your travel expense.
Note that it is better to book in advance of your travel date when redeeming your travel points since prices may go down and availability will be higher. Also, note that taxes or fuel surcharges and booking fees may be charged on the travel rewards card when redeeming points. Before getting a card, compare its fine print and see how the points are valued, the restrictions that apply and how they are redeemed.
How Do I Compare the Best Travel Rewards Programs?
It is important to understand how the points in each card are valued when comparing travel rewards credit cards. There are several rewards program in Canada and each program is different. You can read the card agreement to understand the restrictions and guidelines. You can also make use of the tools we have provided in our site to easily compare them. Furthermore, there could be more than one card in each program, you can get a card that is best for you by making use of our rewards calculator.
Why Do I Need a Balance Transfer Credit Card?
With balance transfer credit cards, you can pay down credit card debt on a card by transferring the balance to a different card with lower interest rate. You can actually save hundreds of dollars in interest by using balance transfer credit card to aggressively pay down credit card debt during the low interest promotional period. In other words, balance transfer credit card can help you to lower your debts and hence improve your finances.
What do I consider before going for a balance transfer credit card?
Balance transfer credit card is an excellent option to help you get out of consumer debt sooner and also save money. But it is necessary to consider the purchase interests, balance transfer fees, as well as the standard interest rate at the end of the promotional period.
In most cases, card issuers charge 1.0 – 5.0% of the transfer amount. A transfer of $10,000 balance will attract 3% transfer fee, which is $300. In some cases, the balance transfer fee may be too high for the transfer, depending on the interest rate.
It is also possible that interest rate will accumulate in the long run, resulting to more costs. This is usually the case if you have not paid off your debts before the promotional period ends or if you missed a payment when the promotional period expires and the standard interest applies.
Furthermore, if you use your balance transfer credit cards for new purchases before paying off the amount on the card you transferred over, the amount will attract a standard interest rate (usually 19.99%). Payments you make after the balance transfer will first apply to the balance transfer amount. In other words, interests will continually accumulate on the card after you transfer the balance unless you pay off the original amount completely.