 |
The 5 Main Types of Credit Cards- Charge Cards -Of the five main different types of credit cards, these are a little different. They aren't even considered credit cards to some folks because you have to pay off your entire balance at the end of each billing period. Charge cards are good because there are no interest charges, but they sometimes include an annual fee. You just have to make sure you pay your balance every month, and keep your spending habits in check.- Fixed-rate Cards -Fixed-rate credit cards have a fixed rate of interest. Easy enough. Some people like to know exactly what interest rate they are paying instead of having it change on them every once in a while. However, these types of credit cards usually have the highest interest, and in turn their popularity has fallen.- Gold, Platinum, and Titanium Cards -I could have named this page the 7 types of credit cards, but these 3 cards are all alike. They are the status cards, meaning usually only people with well established credit reports are able to receive them.They offer advantages such as buyer protection plans or cash back after making an expensive purchase; some of them offer roadside assistance perks and such. They offer high credit limits, but they usually come with very high annual fees.
- Rewards Cards -Rewards cards are the types of credit cards that people love, because they get something back in return. They offer cash back, rebates on gas, airline miles, hotel discounts, and much more.In order to be more competitive, credit card companies are offering more and more rewards cards with different types of rewards. As long as you keep making purchases with your card, your reward gets bigger and bigger. But you must be very careful, because these cards will make you want to overspend, and that's not good money management.
- Variable-rate Cards -Unlike fixed-rate cards, the interest rate on these cards changes from time to time. The rate is controlled by the card's lending institution, which is usually tied in to the bank's prime rate, plus 6 percent. All this translates into your interest rate that you just had last month, may be higher or lower depending on the bank holding your card.These cards first became popular because the interest rates were lower than the interest rates of fixed-rate cards. The majority of cards out there are variable-rate cards now.
|
