A good APR for a credit card is 14% and below. That's roughly the average APR among credit card offers for people with excellent credit. And a great APR for a credit card is 0%. The right 0% credit card could help you avoid interest entirely on big-ticket purchases or reduce the cost of existing debt. But you generally need at least good credit to qualify for such a card, and 0% APRs only last for a limited time. As a result, the very best APR for a credit card is one you don't need to worry about. If you pay your bill in full every month, your credit card's interest rate is irrelevant because it will never apply. And you don't need a certain credit score to accomplish that.
Credit card miles work by rewarding you for making purchases using your card and then allowing you to use your stockpiled miles for travel, gift cards, cash back or other options. Credit card miles are one of the three major types of credit card rewards, the other two being cash back and points. Points and miles basically function the same way, but miles are more closely tied to travel, especially air travel.
Getting the right credit card doesn’t have to be a struggle or a guessing game. Sure, shopping for plastic might seem like looking for a needle in a haystack. There are hundreds of offers with similar-sounding names to choose from. There’s lots of terminology to learn. And who has either the time or the eyesight to pour through all the fine print?
But finding and ultimately getting approved for the best possible credit card is fairly easy when you know where to look. For starters, you can use WalletHub’s anonymous CardAdvisor tool to get a recommendation based on your answers to a few simple questions. You can get more-personalized picks by signing up for a free WalletHub account. Or you can simply head straight for the top card in your category of choice, as selected by WalletHub’s editors from 1,000+ offers (some offers are from our partners).
When you tally up the pros and cons of credit cards, a couple of things are clear. There are many reasons to use a credit card, from convenience and credit building to 0% financing and rewards. But considering how easy it is to overspend with a credit card, how expensive credit card debt can be and how missed payments can hurt your credit score, there’s also reason to be cautious. We rack up billions of dollars in credit card debt each year, for example. And anytime you’re 30+ days late on a payment, it’s noted on your credit report for seven years. Most importantly, though, the advantages of credit cards vastly outweigh the disadvantages for most people. You don’t even need to make purchases with a credit card to benefit. Just educate yourself on what to do and what not to do, and you’ll be alright.
You have to be at least 18 years old to get a credit card account. But there is no minimum age requirement for authorized users to have a credit card from most major banks. So an adult could even add a baby as an authorized user on a credit card, giving the baby a card with his or her name on it and the ability to begin building credit before learning how to walk to the store to make a purchase. But while there’s no legal minimum age for authorized users, individual issuers may add their own restrictions.
A secured credit card is a type of credit card for people with limited or damaged credit that requires the user to place a refundable security deposit, which the card’s issuer holds as collateral until the account is closed. This deposit makes it less risky for banks and credit unions to issue credit cards to inexperienced applicants and people with a history of payment problems. If something goes wrong, the issuer can just keep the money. As a result, secured credit cards offer the highest approval odds of any type of credit card. And they don’t need to charge the same high fees as unsecured credit cards for bad credit.
Getting a credit card can be quite simple. Just compare offers online, and click “Apply Now” once you find one you like. From there, you’ll fill out a straightforward credit card application on the issuer’s secure site. And that’s it. You’ll find out whether you’ve been approved within 14 business days, if not immediately. And your card will arrive in the mail soon thereafter.
There are four ways to increase your credit limit on a credit card: 1) Request a higher limit from your credit card’s issuer; 2) Wait for your credit card company to automatically raise your credit limit; 3) Add to a secured credit card’s security deposit; and 4) Apply for a new credit card account. Which you choose depends on what type of credit card you have and whether you’re looking for more spending power or a higher limit for credit-improvement purposes.
Low credit card limits are more than just an inconvenience. They can also lead to credit score damage due to high credit utilization. So people have different reasons for wanting to increase credit limits. And it’s no surprise that getting a higher credit limit is a popular goal, considering that some credit cards have starting limits as low as $200. Even many credit cards for people with good credit scores have credit limits of just $500+.
More than 7 in 10 0% balance transfer credit cards charge a balance transfer fee, according to WalletHub data. The average fee is equal to about 2.6% of the amount transferred. And that would cost the average household over $200, if they were to transfer their nearly $8,000 in credit card debt.
The Visa Infinite benefits include everything you’ll get with regular Visa or Visa Signature cards, plus a lot more. Most notably, only Visa Infinite cards have travel insurance, purchase protection and return protection. All Visa Infinite cards are eligible for these benefits, although the card’s issuer can choose whether or not to include them. You should take advantage of as many of the perks as possible, since they come free with your card.
Below you’ll see how Visa Infinite benefits compare to other tiers and learn about these benefits and what they can provide for you.
Credit card interest rates tell you how much it will cost to borrow money from a credit card company, by carrying a balance from month to month. Credit card issuers indicate that cost by displaying credit card interest rates as an annualized percentage of your balance, also known as an Annual Percentage Rate (APR). For example, if your interest rate is 20% and you carry a $500 balance, you would owe roughly $100 in interest after a year.
Most new credit cards issued nowadays are smart cards, as issuers are transitioning over to them. Europe started using smart credit cards in the 1990s, but the United States didn’t really start the move until 2014.
Understanding the credit card climate is important for two reasons. First, credit card offers change regularly, based on the health of the economy and issuers’ business objectives. So being able to see the bigger picture – averages, trends, etc. – gives you a baseline against which to compare offers. And that will help you find the best credit card deals as well as ultimately save more money.
Monitoring the credit card landscape can also tell you a lot about the health of the U.S. consumer. For example, 0% introductory APRs and initial rewards bonuses dried up during the Great Recession. And the decline in consumer credit quality during that period was a big reason why.
Credit card points are one of the three main types of credit card rewards, the others being cash back and miles. Cardholders can earn points in many ways, including making purchases, spending a certain amount within a few months of opening an account, or referring a friend (some cards are from WalletHub partners).
How many different types of credit cards there are depends on how you look at it. There’s a strong case to be made that there are two types of credit cards, but there are actually three different arguments for that. On the one hand, you could group cards based on whether they require you to place a refundable security deposit. Secured credit cards do; unsecured credit cards don’t. You could also segment things based on where a card can be used. Credit cards with the Visa, Mastercard, American Express or Discover logo can be used anywhere. Store credit cards can only be used at the retailers they’re affiliated with. Or you could split up the offers based on whether they require you to pay your bill in full every month. Charge cards; other credit cards don’t.
Small business credit cards without a personal guarantee are very rare. A representative of the company almost always has to agree to personally pay any balances the business cannot. Large corporations with tens of millions of dollars in annual revenue can get corporate credit card accounts using their assets as collateral. And there are a handful of outliers available to smaller companies, half of which work only at specific gas station chains. But most small business owners will have to give their personal guarantee to get a business credit card. When you apply for most major business credit cards, you will have to list your own Social Security number as well as your company’s Tax Identification Number. The terms and conditions will state that both you and your business are liable for balances. And the issuer will review your credit history, as well as that of your company, before making a decision.
Soft pull credit cards let you check for pre-approval and request a credit limit increase without a hard credit inquiry. Most soft pull credit cards do not, however, allow you to open a new account without a hard inquiry. With the exception of a handful of secured credit cards that don’t check your credit at all when you apply, you can’t get a credit card without a hard inquiry.
A hard inquiry is when a lender reviews your credit history in response to your application for credit. And each one does a bit of temporary damage to your credit score, with the impact being most pronounced when you have numerous inquiries in a short period of time. So being rejected for a credit card will make it harder to get approved for your next choice, and you may need to wait a bit before applying again.