Are you Ready to Own your First Credit Card? Here’s a Quick Beginner’s Guide for You
Here are the important things to consider when shopping for a credit card in the Philippines:
- Annual fee: The membership fee you pay for the convenience of using a credit card. Many starter credit cards have waived annual fees for the first year, so you can save money as a new credit cardholder.
- Interest rate or finance charge: The interest that will be charged when you carry a balance over from the past month
- Penalty fees: The bank charges a late payment fee when you don’t pay at least the minimum balance by the due date. You also have to pay an over credit limit fee when you go beyond your credit limit. If the bank doesn’t charge it, your transaction will be automatically declined when you exceed your credit limit.
- Rewards program: Redeemable points for every amount spent using the credit card, including cash back rebates, annual fee waivers, gift certificates, and air miles. Note that credit cards with very low annual fees or interest rates usually don’t offer rewards.
- Eligibility requirements: The minimum age, income, and other requirements to qualify for a credit card
Some reminders for first-time credit card users:
- Pay it off in full every month. This will keep you from paying finance charges and late payment fees.
- Don’t spend beyond your means. Especially if you’re given a six-digit credit limit, never make the mistake of maxing out your first credit card. It’ll be harder to pay your monthly balances that way.
- Monitor your credit card transactions and statements regularly. If you notice anything suspicious, report it immediately to the bank.
- Never share your credit card details. Protect yourself from credit card fraud by making sure you don’t give out your credit card and personal information to anyone.
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