Tag Archives: credit card advice

How to Manage Your Credit Card During Difficult Times

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Life can get expensive, especially during times like these. While your credit card has likely provided you with some additional freedom and flexibility lately, it’s important to remember that your credit card is not free money. You will have to pay it back eventually (and with interest)!

With U.S. credit card debt hitting an all-time high of $930 billion earlier this year, according to the latest data from the Federal Reserve Bank of New York, we could all probably use a reminder on how to effectively use and manage our credit cards. Here’s some important advice:

Try to pay your credit card off ahead of time.

There are many reasons you should always try to pay your credit card off ahead of time, but the most important is to avoid paying interest. Accounts that don’t run a continuous balance are given an interest-free grace period, which usually lasts until the next due date. If you can’t pay in full, be sure to pay as much as you can – in order to reduce your interest payments.

In addition to avoiding interest payments, paying your credit card off ahead of time can also help to improve your credit score – since it reduces the amount of your credit limit used. This, along with payment history – can account for the majority of your credit score.

Don’t strain your wallet.

You should avoid maxing out or spending anywhere near your credit limit, as it could cause long-term financial issues – like fees, debt, and damage to your credit score. A good practice is to use less than 40% of your available credit. Treat your credit card similar to a debit card or checkbook. If you don’t have the money currently or can’t save to pay it off later, that should be a sign that you really can’t afford to make a purchase.

Monitor your balance daily.

If you’re using your credit card for everyday purchases, it can be easy to forget how fast those daily transactions can add up. That’s why it’s crucial to regularly monitor your balance. One of the best ways to do this is to download your card’s mobile app. Also, be sure to set up daily or weekly account balance updates/notifications that can be sent directly to your phone or email. You can often do this right from the mobile app, or through your online account. Typically you can also set up monthly payment reminders here too.

Take advantage of your credit card rewards. 

Take full advantage of any rewards or benefits programs offered through your credit card. This can mean anything from retailer gift cards, cash back, electronics and airline miles. These perks can save you money! If you’re contemplating a new credit card, make sure to choose the credit card that best suits your needs and lifestyle – along with a low APR.

First Financial has great credit card options, lower APRs and no annual fee.* 

Let us help you find the right card for you! Check out our website or give us a call so we can answer any questions you may have. Or if you like what you see, you can apply online 24/7!

*APR varies up to 18% when you open your account based on your credit worthiness. These APRs are for purchases and will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fees. Other fees that apply: Balance Transfer and Cash Advance Fees of 3% or $10, whichever is greater; Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa Credit Card and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties. See firstffcu.com for current rates.

Article Source: Jackson Bolstad for CUInsight.com

 

5 Ways You Should Never Use Your Credit Card

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We all know that credit cards can be a valuable tool. They can help you build credit when you’re just starting out, and can really benefit you in the case of a spending emergency. However – if you’re not careful, they can do more harm than good. When it comes to spending, here are five ways you should really never use your credit card.

To help you feel better: Yes, a new purchase can cheer you up, but if you’re looking to feel better – a mountain of debt probably will only make things worse in the long run. If you feel the need to splurge, use whatever cash you have in your wallet or make sure you’re spending from your checking account using a debit card instead.

Hospital bills: Credit cards are best to use on a purchase that you can pay off quickly. Medical bills typically aren’t small, so be sure to think about how long it could take you to pay off that amount of debt. This type of debt can quickly build up, being that you are probably paying a pretty high interest rate each month.

A cash advance: If you’re in a pinch, you might think taking a cash advance from your credit card is a good idea. However, you should first consider other options before going down this road. A cash advance may seem like a good option, but it may carry a higher interest rate than your normal credit card. You may want to do some digging into the fine print in your account disclosures before considering this.

Paying for college: This is probably one of the worst things you could ever put on a credit card. You may not be thrilled about student loans, but those usually come with much lower interest rates than a credit card ever could. If you’re having trouble paying for school and you don’t have a full time job yet, you may be sitting on this debt for years – if it’s on a credit card. It would not be a wise decision to begin your financial future with thousands in credit card debt.

To help start a small business: It’s great to follow your dreams, and if starting a small business is one of them – wonderful. However, charging your business equipment to a credit card is not the best idea. Try looking into a small business loan instead, rather than purchasing items on a higher interest credit card. No one wants to think about it, but what happens if your small business doesn’t make it and you’re still paying off thousands on equipment you can no longer use?

If you are looking for higher credit lines, lower APRs, no annual fees, a 10-day grace period, rewards (cash back or on travel & retailer gift cards), an EMV security chip, and more, check out First Financial’s Visa Credit Card options. Click here to learn more and apply online today.

 *APR varies up to 18% when you open your account based on your credit worthiness. These APRs are for purchases and will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fees. Other fees that apply: Balance Transfer and Cash Advance Fees of 3% or $10, whichever is greater; Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa Credit Card and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties. See firstffcu.com for current rates. No late fee will be charged if payment is received within 10 days from the payment due date.

Article Source: John Pettit for CUInsight.com

 

The Pros and Cons of Having Multiple Credit Cards

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Credit cards. You were probably pretty excited when you got your first one, and if you weren’t cautious with it, that excitement probably faded pretty quickly. But there’s no denying that a credit card can be a valuable tool. So how many should you have? Here are some pros and cons to having more than one credit card.

PRO – It can be great for your credit score: When credit bureaus determine your credit score they look at your debt utilization ratio (percentage of your available credit that’s in use). If you’ve got one credit card with a $5,000 limit, and you’ve spent $4,000 on it, then your debt utilization ratio is 80%. If you get a second credit card with a $5,000 limit and keep a zero balance, your debt utilization ratio is now 40%. Your credit score will thank you.

CON – It can be damaging to your credit score: While a larger debt utilization ratio might be good for your credit score, the act of opening the account can be damaging. Anytime you open a new line of credit, your credit score can take a small hit. Just make sure not to open two new accounts in a short period of time.

PRO – Don’t keep all your eggs in one basket: Occasionally you might have trouble with a card, and it’s always great to have a back-up. Let’s say you’re traveling and your card is lost or stolen. Having a second card stowed away somewhere will really come in handy.

CON – Large amounts of debt: If you’re not very good at keeping your spending in check, having multiple credit cards can potentially be a huge disaster. If you’re lacking self-control when it comes to credit cards, the less you have – the better.

If you’d like more insight into your credit score and managing your credit – view our credit and debt management guide here.

Article Source: John Pettit for CUInsight.com

 

Credit Card Regret: It’s More Common Than You Think

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“Regrets, I’ve had a few. But then again, too few to mention.” – Frank Sinatra

If you’re the kind of person who prefers to play it safe, there’s a good chance that, like Ol’ Blue Eyes, your list of regrets is mercifully short. But if you’re the adventurous type who’s more likely to yell “YOLO!” than take the time to consider the pros and cons, you may have made more unfortunate decisions than you care to admit. And if we’re being honest, some of them are probably related to finances.

Going into credit card debt is one of the most common financial regrets. According to a recent NerdWallet survey, “About 6 in 7 Americans (86%) who have credit card debt say they regret it.” With numbers that high, it’s safe to assume most of us would make different credit decisions if given a chance.

Common Reasons for Credit Card Regret

If you’ve ever opened a new credit card account and felt that distinctive twinge that tells you it was a bad decision, there’s a pretty good chance you filled out that credit application for the wrong reason. Bad reasons come in a variety of forms. Here are a few of the most common:

You wanted that sign-up swag. T-shirts. Koozies. Collapsible drink coolers. It doesn’t matter what it is, we all love free stuff. Credit card companies know this. Sure, free t-shirts are cool, but are they really worth opening a credit card that will charge you 26% interest on your purchases?

You can’t resist that one time discount.

“Would you like to save 25% on today’s purchase by applying for a store credit card?” If you’ve ever shopped at a retail store, there’s a good chance you’ve heard this sales pitch at the checkout register. If you took advantage of the offer and suddenly wished you hadn’t, you’re not alone. According to a recent survey, almost 75% of Americans have at least one store credit card. Not surprisingly, nearly half of them regret it.

You’re in a financial pinch.
When your checking account is running low, it can be incredibly tempting to sign up for a credit card just to get some temporary relief. However, credit cards don’t remedy poor financial habits, they tend to make them worse. If you’ve ever signed up for a new credit card “just to cover things until payday,” this regret may feel all too familiar.

OK, you signed up for a credit card and regretted it. Now what?
Before we go any further, it’s important to remember one thing: Just because you have a credit card doesn’t mean you have to use it. Even if your regrettable card carries a 26% interest rate, 26% of $0.00 is still $0.00. However, if you’re worried you won’t be able to resist using your card, you might be tempted to close your account immediately. This could certainly help you avoid charges you can’t afford to repay, but there may be a better approach.

Available credit and length of credit history are two of the main components of your credit score. Having an open, active account you don’t use could actually help you. If you were given a $1,000 credit line with your new card and you don’t make any purchases, you have $1,000 of available credit. If you close the account, you have no available credit. In this case, maintaining the credit line may be beneficial for your credit rating.

As for the length of credit history, that part’s fairly self-explanatory. The longer you maintain a satisfactory account, the more favorably it reflects in your credit score. With this in mind, you might be better off just removing the card from your wallet instead of closing the account altogether.

Good credit is one of the building blocks of your overall financial health. If you live, work, worship, attend school, or volunteer in Monmouth or Ocean Counties in New Jersey and you’re trying to find financing options that are right for you, contact First Financial to make an appointment with a representative. We can help you review your financial situation and recommend the best products and programs for your needs. We are happy to help with managing your credit — and finances in general, with no regrets!

The Pros and Cons of Store Credit Cards

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We’ve all approached a register to complete a purchase and were asked if we’d be interested in applying for a store credit card. And with the holiday shopping season about to get in full swing, chances are – you are going to be asked more than usual. There are pros and cons to having a store credit account, so make sure you take a good look before you open one.

Pro: They are easier to get

Application requirements for store credit cards are generally less strict than regular credit cards, so chances are you’re more than likely to get approved. If you’re looking to get a card from a store you often visit, this should make you happy and save you some money (provided you don’t rack up a balance).

Con: They carry higher interest rates

The average store credit card is 8-10 points higher in interest than regular credit cards. This may not be a big deal if you’re only using the card sparingly, but a few big purchases that aren’t paid off completely by month end could come back to haunt you.

Pro: They help you build credit

If you’re young and haven’t had a chance to build any credit, a store credit card could be very helpful. It’s easier to be approved for one so you wouldn’t need much credit history to qualify. A purchase or two a month will put you on the road to good credit too. Just make sure you pay the card off each month.

Con: Their use is limited

Some store credit cards may allow you to use them at sister companies, but for the most part, you’ll only use them in the store that issues them. That might be fine if it’s a store like Target or another retailer that you often visit, but overall it won’t be a very versatile card.

Pro: They provide in-store rewards

A lot of cards will reward the user with discounts and promotions which can provide great value. Free shipping for instance, is a perk that is appreciated. Just be sure these benefits don’t cause you to overspend either!

First Financial’s Visa Credit Cards offer benefits that include higher credit lines, lower APRs, no annual fees, no balance transfer fees, a 10-day grace period, rewards (cash back or on travel & retailer gift cards), an EMV security chip, and more!* And they can be used anywhere Visa is accepted.

 Click here to learn about our credit card options and apply online today.

 *APR varies up to 18% when you open your account based on your credit worthiness. These APRs are for purchases and will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fees. Other fees that apply: Balance Transfer and Cash Advance Fees of 3% or $10, whichever is greater; Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa Credit Card and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties. See firstffcu.com for current rates. No late fee will be charged if payment is received within 10 days from the payment due date.

Article Source: John Pettit for CUInsight

9 Things to Remember When Using Your First Credit Card

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Getting your first credit card is a significant financial milestone. After sorting through an endless array of program options and promotional offers, you made your choice, filled out the application, and saw those two magic words: You’re approved!

After the initial excitement wears off, it’s important to remember that just like your first car, your first credit card comes with a lot of responsibility. While it may be tempting to grab some friends to take the new plastic for a test drive, it’s a good time to exercise a little restraint. The financial decisions you make now will have long-term effects. It only takes a momentary lapse in judgement, to make a mistake that could follow you for years to come.

Before you start exercising your newfound financial freedom, here are a few tips to make sure your first credit card experience is a positive one:

1. Pay attention to the fine print. Even if you don’t need reading glasses, you may want to have a pair handy. The big credit card companies tend to sneak stuff in the small print. Introductory interest rates can be attractive (like 0% APR for a certain amount of time), but once those offers expire, you could be left paying higher interest on your purchases. Not to mention, if you are carrying a balance when your 0% offer expires – you could be left to pay an extremely high APR on that balance.

2. Don’t be a card counter. If you have multiple cards, it can be tempting to spend more than you intended. Also, it makes your wallet pretty large – which makes for uneven seating or a heavy purse. Simplify your life – stick to a single card, and keep the credit limit sensible.

3. Consistency pays off. This simple step will help you avoid additional interest charges, and it’s an effective way to build an excellent credit rating.

4. Always pay your bill on time. Late payment charges are usually more expensive than your minimum payment, which can make it hard to keep up with your bill. If you’re worried that you’ll forget the due date, most cards offer an automatic payment option. Use it. Or set a recurring reminder for yourself on your phone or a computer calendar.

5. It’s your budget, don’t fudge it. Try to think of your credit card as for emergencies only. Do your best to continue using your checking account or cash to cover everyday expenses. Your credit card is like that friend you call when you need help moving or a ride to the airport. There when you need it, but not to be overused.

6. Steer clear of cash advances. These advances usually charge a higher interest rate than regular credit card purchases. The convenience isn’t worth the cost.

7. Keep your monthly credit card payments to less than 20% of your income. Once your bill exceeds that amount, it becomes exponentially more difficult to stick to a sensible, reasonable budget.

8. Review your credit card statements each month. In addition to being a smart way to track your spending, regular monitoring is the most effective way to combat credit card fraud and identity theft.

9. Be honest with yourself. If you find that your spending gets out of hand, there’s no shame in putting your credit card away (or getting rid of it all together), until you correct your bad financial habits.

Credit cards can be useful tools for emergencies, and when used properly, they can help you maintain a strong credit rating. But with so many card options available today, it is essential to choose the one that’s right for you.

If you haven’t secured your first card yet and are wondering where to find a trustworthy offer, First Financial Federal Credit Union offers a variety of Visa Credit Cards to meet your financial needs. If you live, work, worship, attend school, or volunteer in Monmouth or Ocean Counties in NJ – we’ve got the perfect credit card to fit your lifestyle. Learn more here, and apply online 24/7.

 *APR varies up to 18% when you open your account based on your credit worthiness. These APRs are for purchases and will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fees. Other fees that apply: Balance Transfer and Cash Advance Fees of 3% or $10, whichever is greater; Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa Credit Card and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties. See firstffcu.com for current rates.