My Friend's First Credit Card

A friend of mine came to town for a visit on Friday, so we headed out for some of Walla Walla's finest culinary offerings (a basket of deep fried chicken gizzards and a few pints of locally produce IPA for me!). We talked about this and that, and somehow my friend's future travel plans and his lack of credit cards came up. He has never had a credit card before, but he's looking to get one before hitting the road. Smart move - I almost never carry cash anymore, and especially when traveling it's a good idea not to.

Despite never having a credit card before, my friend's credit card application should go rather smoothly because he does have a mortgage. Anyone who has ever had a mortgage (and who is not opted out of unsolicited credit card applications) can tell you that mortgages are like credit offer magnets - everyone wants to you apply for their card. It creates a confusing mess of options, particularly for one who has never owned a credit card before, making the credit card research somewhat difficult. I like to save time in this endeavor by using sites like dealsforcreditcards.com, which show you at a glance what the offerings of various issuers are, what annual fees you have to pay (if any), balance transfer and purchase interest rates, etc. The main reason I like such sites is that the cards are searchable by type - low interest rate, cash or points rewards, and so on - which narrows down and speeds up my searches considerably.

Generally, I always go for cards that pay cash back for purchases, which typically are 1% for general purchasing with some extra kicker for specific categories, like 3% cash back on gasoline purchases. I don't like points cards because the number of points required to get merchandise, travel, etc. through those programs is typically many times more than the cost of just buying the item or service in question (when points are earned at a rate of 1 point per $1 spent, which they typically are - you might end up having to spend $25,000 to earn 25,000 points for a round trip airline ticket, for example).

Contrary to what you might be thinking about the availability of credit cards given the current state of our economy and of our banking systems, there are still plenty of excellent cards with lots of perks being offered for people who have kept their financial houses clean. If you're looking for one, try some of the links above and shop around. Despite their notoriety as money traps, credit cards used properly are actually money savers, and everyone would do well by saving a little bit of money.