More than one-third of military families are carrying at least $10,000 in credit card debt. Whether you have a high balance or not, be sure to choose your credit cards wisely. Here are three important things to look for:
A high interest rate if you’re running unpaid balances could leave you owing more than you borrowed. Typically, your best option will be to go with the lowest possible interest rate as long as the card’s other features are acceptable. And, be wary of promotional rates, which can be very enticing at first glance. But if you miss a payment or go over the limit, you could end up paying a lot more in the long run.
Whether it’s over-the-limit fees, late fees or annual fees, penalties and fees are associated with all credit cards. But some cards can be much more punitive than others — especially if you travel overseas. When you use your card overseas, the financial institution is charged an international fee, which most institutions pass on to the cardholder. So, if you plan to travel overseas for any period of time, you’ll want to find a card that offers low international fees—even if it means paying a slightly higher interest rate.
Most cards offer special features and rewards programs, which can be really nice benefits if taken advantage of as you can earn points that can be redeemed for cash, travel or other purchases. But, don’t make your decision based on a rewards program alone, which can be easily offset by a high interest rate or cumbersome fee structure. For military families, customer service also tends to be an important concern, so seek out companies that put a high priority on person-to-person customer service. When in a foreign country, it’s nice to be able to call the customer service line and speak to a representative who is familiar with your account and the military lifestyle, understands your needs and speaks your language.
In the end, the best credit card for you and your family will depend upon your lifestyle, and it’s incumbent upon you, the card owner, to know what you’re paying for. Credit card companies can be very tricky, so you’re going to have to do your homework to come out on top.
To gauge the attributes of your current card(s), take the First Command Bank credit card challenge at http://www.firstcommandbank.com/challenges/first-command-bank-challenge.htm and see how your card stacks up against our Visa Platinum Credit Card, which was named to Smart Money’s “Best Credit Cards of 2012” list.