All customers are going to use a credit card in different ways, so different features will benefit different customers. The best overall credit cards are those that provide users with the lowest fees and interest rates, the best rewards and the greatest customer service.
Credit cards are a useful financial tool for those who use them wisely. They can be used to pay for money emergencies, for purchases over the phone or Internet and in order to pay for purchases a bit at a time. They are a favorite form of payment in the United States.
What are common fees that credit cards have?
Credit cards have many fees that customers can be charged with. The best credit cards have few fees associated with their use. Common credit card fees are as follows:
Annual fees or membership fees. Credit card companies will sometimes charge a credit card annual fee for the privilege of using the credit card. They can range in prices, but they are generally under $100 a year. The best cards will likely have no annual fee.
Balance Transfer Fees. Many people transfer the balance of one credit card to another to take advantage of lower interest rates or avoid overdue fees. To combat this temporary use, many credit card companies have instituted balance transfer fees. These fees are generally a percentage of the amount transferred. The credit card balance transfer fees generally range from 1% to 5%, but are usually never lower than $5 per transfer. Not all credit cards have balance transfer fees, and those that have no fee or a low fee are those that really stand out from the pack.
Cash advance fees. This is when a customer uses a credit card to get cash from an ATM. This fee is generally a percentage of the amount of the transaction; it is usually a very high interest rate, around 20%, that accompanies credit card cash advances.
Late credit card payment fees. These fees are assessed by credit card companies when payments are late or under the minimum payment amount. Usually under $50, these fees can add up over time. Almost all credit cards have late payment fees to discourage low or late credit card payments. Most credit cards also raise interest rates on late balances.
Overage fees. Just like when a consumer goes over their checking account balance with their bank, credit card companies also assess a fee when a customer goes over a credit card’s limit. These fees are also generally under $50, and they are common on most credit cards.
There is a host of other less common fees, such as credit card foreign transaction fees or statement fees. The best credit cards will have as few fees as possible. While the rules for credit card fees were changed by the Credit Card Accountability, Responsibility, and Disclosure Act of 2009, credit card companies are always looking for ways to improve their profits.
What are common interest rates charges by the best credit cards?
Interest rates are usually the highest charge customers pay for credit card use. When a customer carries a balance month-to-month, the credit card companies charge an interest rate for the monthly balance. Low interest rates would be those under 5%. A $100 balance would be charged $5 under a 5% interest rate. Interest rates also go up a great deal when payments are overdue or under the minimum payment amount.
The best credit cards have low interest rates or even no interest rates. Every consumer should check the fine print, however. Many low or zero-interest rate offers increase to higher rates after six months. The top rated credit cards will retain that low balance as long as a customer remains current with the monthly payments.
What are rewards that the best credit cards have?
Reward cards attract customers with perks for using the credit cards. Common rewards include cash back, airline miles, or points towards purchases out of a catalog. The best credit cards have rewards that customers want the most.
Generally, cash is king, and the best credit cards pay a high interest rate on transactions for cash back. General rates for cash back are 1% to 2%, so a high cash back rate really makes a credit card stand out from the rest.
What are the customer service ratings for major credit cards?
J.D. Power and Associates conducts surveys of major credit card companies and the banks that partner with them. The ratings reflect the products, fees, and overall satisfaction customers have had with the credit card companies or banks.
One way to find the best credit cards is to compare all of the fees, rewards, and ratings with our FREE credit card finder above!
- Where can I find low fee credit cards?
- Is there such things as student loan credit cards?
- What are some unsecured credit card companies?
- Regions Bank Credit Card
- Are there any credit cards offering fixed rates of interest on transfers?
- How does a credit card rate of interest work?
- Is there such thing as low limit credit cards?