What's a good credit card?

August 17, 2022 10:44 AM

What's a good credit card to get? I had a Fidelity Investments account one that I think you need an investment account to use, but I don't have one (my now ex husband has one). So I need a new credit card. I don't want one with airline points, as I am not a frequent traveler. I use Bank of America for my checking account.
posted by bookworm4125 to Work & Money (19 answers total)

Although Nerdwallet makes money from credit card signups, their aggregated information is pretty solid. This chart can help you figure out what to think about and maybe give you some ideas:

https://www.nerdwallet.com/the-best-credit-cards
posted by chesty_a_arthur at 10:49 AM on August 17, 2022 [7 favorites]

I should have said - the first thing you'll want to do is get a sense of what your credit scores are, if you don't know. Checking your credit will be a "hard pull" i.e. it will actually cost you a few score points, briefly, but it's worth it to know what your credit score is. That's a really important factor in what cards will be available to you.
posted by chesty_a_arthur at 10:50 AM on August 17, 2022

I like my Bank of America Cash Rewards card just fine. One thing Bank of America does is that if you park enough money in your checking account or linked Merrill account the cash back % on the credit card goes up so I get 2% back right now. BoA's savings accounts are awful so I didn't bother to even make one. Having my credit card with the same bank as my checking account makes it very easy to pay the monthly bill with their app, takes me about 30 seconds.
posted by JZig at 10:51 AM on August 17, 2022

Re credit score: check with BOA's website; they likely have some dealio with one of the big credit agencies where they give you a pretty good hint what your score is. Saves you the hard pull. Also remember that you're due one free credit report a year.

Which credit card is best for you depends to some extent on your finances. If you're carrying credit-card debt, the interest rate is likely what matters most (lower is better!). If you're credit-card-debt-free, then look at rewards, keeping in mind that beyond the percent-back type of reward, they can distort or increase your spending in unhealthy ways.

I'm credit-card-debt-free, so I rely on a 2%-back card from my credit union. I have no idea what its interest rate is because I don't have to care.
posted by humbug at 10:55 AM on August 17, 2022

If you're in the US, you can register at the free credit-tracking site CreditKarma.com and, in addition to pulling your scores from two of the three major credit bureaus, Equifax and TransUnion, will compare those numbers to available credit cards and give you ratings on how likely you are to be approved, also breaking down their APR, balance transfer options, rewards, etc.

They do this as a business practice, not out of the kindness of their hearts. Nevertheless, it's a good way to familiarize yourself with the types of cards out there and what you might want/be able to get.
posted by DirtyOldTown at 11:06 AM on August 17, 2022 [2 favorites]

It depends on what kind of person you will (mostly) be. If you are a person who pays off your bill every month, then whatever card has the best rewards is the one you should choose.

If you are the kind of person who will most likely not pay off your bill every month, then search hard to find the lowest interest rate.

That NerdWallet list recommends cards with Annual Fees. Unless you are pretty wealthy and spend a lot on the card, they are a terrible idea. Your card should have no fees.
posted by The_Vegetables at 11:11 AM on August 17, 2022 [2 favorites]

You can check your credit score without the hard pull using creditkarma.com and experian.com (which creditkarma doesn't include). Experian will try and sell you stuff but you don't have to buy anything since the law requires free access to credit reports.

This will have no impact on your credit (as someone who worked back a 580 score to 800 I am keen to these things).

If your credit is north of 750 and you have a highish income you have a lot of options for a credit card. So you'll want: no annual fee, low interest (my apple card has an ~11% rate which is the lowest I've found) and a good cash back %. If you have a cash back card and pay off the balance every month (take on no interest charges), you are literally getting paid to spend money, bizarrely. If you buy apple stuff, the apple card is great. The chase freedom rewards is also a good card. Basically if it has an interest rate under say 16%, no fee, and has cashback of up to 3%, it's about as good a card as there is.

Amex cards often have great rewards, but they all have an annual fee, and the ones with the *best* benefits are charge cards, not credit cards (meaning you *have* to pay the full balance off every month). If you think you can take advantage of those benefits, will never carry a balance (try and think of it as cash), the benefits can often add up to more than the annual fee, and can be a great option.
posted by dis_integration at 11:25 AM on August 17, 2022 [1 favorite]

One thing to add: you may want more than one card. NOT because I think you should use them - but because your credit score is, at least partially, based on your _access_ to credit as well as your payment record. So, if you have access to two or more different lines of credit, your score will be a little higher. I agree with The_Vegetables recommendations, just wanted to point out this little wrinkle.
posted by TimHare at 11:25 AM on August 17, 2022 [1 favorite]

It's a good idea to start with a card that feels low risk and all purpose. If you find you do well at paying your balance every month, you can get different cards to maximize rewards in certain spending categories. I have one card for travel, one for gas/groceries, etc.

While I generally tend to make the argument that the higher fees cards have much better benefits and can easily be worth it, those are generally travel-focused cards. Since you mention travel is not a big category for you, yes, I agree with the other folks here: skip those.
posted by DirtyOldTown at 11:30 AM on August 17, 2022

This typically depends on a lot of factors. Personally, I want the highest rate of cashback, without any points transfer shennnigans.

For me, this is the Bank of America's Unlimited Cash Rewards card. The base cashback rate is 1.5% but if you have sufficient deposits to qualify for Platinum Honors (basically more than 100k in a Merril Edge brokerage account) they increase the cashback to 2.625%. This is supplemented by a Customized Cash card that offers 3% cashback for online purchases, and is upped to 5.25% for Platinum Honors.

If you don't have substantial liquid assets (perhaps because of a divorce!), and don't qualify for at least Platinum then I don't recommend it. You can find several options at 2 percent cash back, like Paypal, Citi, and Wells Fargo. My brother, for example, has a PayPal card and hasn't reported any issues other than a low limit. The Fidelity card is also not bad, if you open up a Roth IRA with them.
posted by pwnguin at 11:44 AM on August 17, 2022

If you're a Costco member, the Costco Visa is a good card - 4% back on gas anywhere (not just Costco), 3% back on restaurants & travel, 2% back at Costco/.com, and 1% everywhere else. You have to be a Costco member, though, and the cash back is issued once a year in the form of a voucher for use at Costco (though you can jump through a couple hoops to have it re-issued as a regular check).

I also like my Amex Gold which has 4 points per $1 spent at US grocery stores, plus some other permanent and rotating benefits, but you have to be sure you'll use it enough to outweigh the $250 annual fee. We buy enough groceries alone to take care of that, but YMMV. Also, it's not a straight 100 points = $1 reward conversion. They have some gift cards where 100 points = $1, but most of their reward options (such as applying points towards charges, or shopping with points at retailers) are 100 points = $0.60 to $0.80 of value.

I don't have the card, but if you have Amazon Prime and spend a lot of money there, the Chase Amazon Prime Signature Card (not to be confused with the Chase Amazon Signature Card or the Amazon Store Card/Amazon Prime Store Card) gives 5% back at Amazon and lesser amounts elsewhere, with no annual fee.
posted by tubedogg at 11:49 AM on August 17, 2022

I have a Wells Fargo 2% cash back on everything, no limits, card I like a lot but I pay my balance off every month. You'll find other cards with percent back but they're often only on certain purchases or up to $xxx a month.
posted by AzraelBrown at 11:58 AM on August 17, 2022

Response by poster: I will pay off my balance every month.
posted by bookworm4125 at 12:52 PM on August 17, 2022 [2 favorites]

i didn't read all the replies here. but if you shop a lot at amazon (i know mefi hates amazon, sorry) the chase amazon prime card is great.

i have credit cards from multiple providers (to up my credit score) and find chase's portal to be the best. wells fargo and bank of america are garbage in my opinion and use those cards very infrequently because of that.
posted by misanthropicsarah at 1:14 PM on August 17, 2022

BofA has a 1.5% unlimited cashback Visa Signature Card.

I think there's a section that lists ALL of their credit card offers in their website, may want to look there.
posted by kschang at 1:20 PM on August 17, 2022

Agree with DirtyOldTown that CreditKarma will give you good guidance on your credit score and recommend cards for you, if available. If this is your only card, you'll want one with a) no annual fee and b) basic cash back rewards. The most important thing for someone without a current line of credit is to get a good basic one that you can pay the balance on and hold for years, so that you can improve your credit. (Length of credit history can count for up to 15% of your overall credit score.) 1.5 - 2% cashback straight up is a pretty common card category available from a lot of servicers. For a personal rec, if you're putting most of your spending into one area, like grocery, I like the Citi Custom Cash that gives 5% back on the largest spend category each month up to $500 (and 1% after).
posted by radiogreentea at 2:14 PM on August 17, 2022

Response by poster: I've had a credit card before and have very good credit. I just have to close the credit card we have now because of the divorce.
posted by bookworm4125 at 2:17 PM on August 17, 2022 [2 favorites]

If you will pay it off every month and you don't care about airline miles or other rewards, just get a basic American Express and call it good. Or get a basic B of A Visa since you have an account with them.

Just because there are a bewildering variety of competing rewards for using credit doesn't mean you have to play the game. All that credit card rewards exist to do is incentivize you to spend more. Find a card with a low annual fee and a good interest rate and call it good.
posted by pdb at 6:13 PM on August 17, 2022 [2 favorites]

Absolutely love Apple Card.
posted by terrapin at 2:49 AM on August 18, 2022