Is It Time To Upgrade Your Credit Card?

Most of us these days carry at least one credit card, and unless careless use means we've built up a problematic level of debt, we often don't give a second thought to the plastic in our wallets. We've become accustomed to the ease of use they provide in making payments online, over the telephone and in person, and it's human nature to let a situation continue if there's no pressing reason to change it. However, the credit card market is constantly changing, and inertia could mean that you're missing out on a better deal - and wherever finance is involved, having a poor deal can be downright expensive.

In earlier days, many people simply applied for the credit card that their bank offered. Having this captive audience meant that little in the way of cardholder benefits was offered, and interest rates were unlikely to be overly competitive. If you still have one of these old cards, it's definitely worth doing some research and applying for a new card which will offer you more. Even if you have a more modern card, it's likely that any introductory benefits will have expired, and any remaining features may be looking a little tired by now.

For example, there's no excuse for a general purpose credit card to be charging more than 20% interest these days, although with the card issuers' tendency to slowly push up the APRs they charge on established accounts, you might well find that your longstanding card account is now charging an unacceptable rate. Somewhere around 15% is the highest people with decent credit ratings should expect to pay, with much better deals than that widely available.

Another example of how the credit card market has changed over the years is the payment of cash back. Older cards, if they offered the facility at all, generally had cash back rates of 0.25% or 0.5%. These miserly offerings look totally out of place today, with a 1% rate almost the de facto standard. Indeed, swapping to a new cash back card now could see you enjoying some truly impressive introductory rates, with one card currently offering a full 5% rate for the first few months you use it, reverting to the still reasonable 1% after that.

The final reason we'll look at for applying for a new card is rewards. In the early days of reward programs, you built up points quite slowly, and the range of options you had for redeeming the points was usually rather limited. It could take years to build up enough points to redeem against an expensive flight to a limited range of destinations with a single nominated airline, for example. Today's cards are more generous with their points allocation, even awarding significant amounts of bonus points when you first use the card, and the range of ways to redeem your points is vastly larger. You can now use your rewards to claim discounts on wine, CDs, experiences, travel, holidays, groceries, broadband costs, utility bills, and much more depending on your choice of reward card.

Even if you're now convinced that a new card would be a good idea, the thought of all the hassle of switching your cards might be holding you back. There's no need - comparing and applying for cards online is easy and quick, and the use of balance transfer facilities means that clearing your old balance is a simple matter, and with a 0% deal it could even save you money in interest charges too!

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