6 Credit Card Perks That Can Help Your Credit

Once upon a time, banks offered toasters to incentivize new customers into opening a checking or savings account with them. 

While financial institutions no longer give out small appliances to attract new clientele, these promotions continue with welcome bonuses, competitive interest rates, and other rewards for account holders.

But banks aren’t the only ones who extend these lucrative deals. Many credit card companies also offer similar benefits — you just have to ask! 

Securing a lower interest rate or bonus points redeemable for statement credit or cash back helps you save more each month and have more money to cover the things you need most.

You may already be familiar with some of the benefits available to you as a cardholder. But there might be a few you didn’t know you could receive. 

To help you out, Credit Karma made a list of lesser-known perks you might not have known you could get. Check them out, then call your card issuer and ask if you can take advantage of these. 

Not only can these tips help you save money, but they may even give your credit a boost.

Move Your Due Date To Fit Your Schedule

Several factors influence your credit health, but your payment history is one of the biggest ones. Paying your monthly statement on time is critical to prevent your credit score from nosediving. 

If you bit off more than you can chew and are struggling to manage multiple credit cards, consider contacting your card companies to see if they are willing to change your monthly due dates.

Consolidating your monthly credit card statements on one due date can make paying your bills on time more manageable and lower the chance of forgetting a payment. 

Limit Spending And Cash Advances

Your credit utilization rate is another crucial factor that determines your creditworthiness. Conventional wisdom typically suggests maintaining the ratio between your balance and available credit under 30%.

Suppose you have multiple credit cards that give you a total credit limit of $10,000. In that case, you should keep your combined balance under $3,000 to ensure your credit utilization rate stays under 30%. 

You can ask your card provider to place a limit on the number of purchases and cash advances you can make with your cards so you can ensure your credit utilization ratio doesn’t exceed 30%.

Since cash advances have higher fees and interest rates than purchases, you might consider limiting cash advances to $0 to prevent these extra charges.

Raise Your Credit Limit

Asking your credit card provider to raise your credit limit is another way to keep your credit utilization rate low. If your credit limit is low, or you usually carry a balance, ask your creditors if they are willing to raise your cards’ available credit.

Do be mindful that this may not be ideal for everyone. If more credit would tempt you to spend more, you probably shouldn’t request an increase. 

Your credit card issuer may also perform a hard inquiry when you request a credit increase, which temporarily knocks points from your score. So before you call, think carefully about whether the raise outweighs the potential credit check.

Reduce Your Interest Rate

Generally, banks are more inclined to help existing customers, particularly ones with positive banking histories. If you’ve held an account with your bank for a while, you should kindly request a lower interest rate, particularly if you consistently pay your bills on time.  

Although you should always try to pay your monthly statement on time and in full, a reduced rate can help minimize your interest payments for those times you have a balance.

Waive A Late Fee

Your bank might be inclined to remove a late fee if it’s your first one. Some credit card companies, such as Discover, even have cards that automatically waive charges on first-time late payments.

Still, it would be best if you didn’t rely on these. If you have a late payment, try to repay it as soon as you can. And if you have a missed payment, call your bank and explain yourself, since they might be willing to help you.

Remove Your Card’s Annual Fee

If you’re considering closing your credit card to save money on its annual fee, think about contacting the provider before you do. Canceling your credit card can impact your credit by reducing your history. 

Your bank might waive the fee for you, particularly if it’s your first year as a cardholder. Or, they might give you a statement credit or bonus to keep your patronage. 

Bottom Line

It never hurts to ask your credit card company or bank about benefits that could potentially boost your credit. Of course, keep in mind that none of these tips can substitute for paying your monthly statement on time and in full or using your credit card wisely.

 

Source
  • “6 Little-Known Credit Card Tips.” Credit Karma, 28 Oct. 2020, www.creditkarma.com/credit-cards/i/little-known-credit-card-tips.
Ian Schindler