Citi Custom Cash vs. Bank of America Customized Cash Rewards card

The Citi Custom Cash℠ Card and Bank of America® Customized Cash Rewards credit card are two cash back credit cards that offer a unique way to earn rewards. Instead of earning specific rates in specific categories, you decide which categories earn you bonus cash back. This is a great feature because it puts you in control of earning extra rewards through your credit card spending.

Citi Custom Cash vs. Bank of America Customized Cash Rewards

To help us compare some of the key features of the Citi Custom Cash card and the Bank of America Customized Cash Rewards card, the key highlights are included in this table:

Card

Citi Custom Cash℠ Card

Citi Custom Cash℠ Card

Bank of America® Customized Cash Rewards credit card

Bank of America® Customized Cash Rewards

Rewards rate
  • 5% cash back on purchases in your top eligible spend category each billing cycle, up to the first $500 spent, then 1%
  • 1% cash back on all other purchases
  • 3% cash back in one category of your choice (gas, online shopping, dining, travel, drugstores, or home improvements and furnishings)
  • 2% cash back on grocery store and wholesale club purchases
  • $2,500 combined spend limit on 2% and 3% categories each quarter
  • 1% cash back on other purchases
Welcome bonus $200 (20,000 ThankYou points) after spending $750 in first 3 months of account opening $200 if you spend $1,000 in first 90 days of account opening
Annual fee $0 $0

Earning cash back

Both the Citi Custom Cash card and the Bank of America Customized Rewards card allow you to earn cash back after spending on the card. Both cards also allow you some control over the categories where you’ll get bonus rewards.

Regular rewards

The Citi Custom Cash earns 5% cash back on purchases in your top eligible spend category each billing cycle, on up to the first $500 spent, then 1% cash back. All other purchases earn 1% cash back.

There are other cards that offer 5% cash back, but most of those have rotating quarterly categories set by the credit card issuer, such as Discover’s rotating bonus categories. Some quarters, it might work great for you, but in other quarters you might find it hard to get much benefit. The Citi Custom Cash card is the first card that offers 5% cash back on the category in which you spend the most. You don’t need to set your 5% category through your account – you’ll automatically earn 5% cash back on purchases in whichever category you spend the most that month, on up to $500 in spending.

It’s important to note that the cash back you earn with the Citi Custom Cash is paid in the form of ThankYou points. This makes the Citi Custom Cash card even more exciting due to the flexibility of ThankYou points. You can always redeem your ThankYou points for cash at a rate of 1 cent per ThankYou point, but you can also combine your ThankYou points with points earned from other Citi credit cards (like the Citi Premier® Card) for added value, and then redeem them by booking your next trip on the ThankYou rewards center.

On the other hand, the Bank of America Customized Rewards card allows you to choose which category earns bonus rewards. You’ll earn 3% cash back on a category of choice (gas, online shopping, dining, travel, drugstores or home improvements and furnishings), 2% cash back on grocery store and wholesale club purchases and 1% cash back on other purchases. But there’s a catch: the 2% and 3% bonus categories are limited to a combined total of $2,500 in spending each quarter.

The Bank of America Customized Cash card is also part of Bank of America’s Preferred Rewards program. This can be a way to supercharge the rewards rate you earn with your credit card. How much cash you have in deposit with either Bank of America or Merrill affects your Preferred Rewards program tier, which in turn could boost your rewards rate.

Those who qualify for the highest tier, the Platinum Honors level, must have at least $100,000 on deposit, but they get a 75% bonus on all cash back they earn with the Customized Cash Rewards card. That means you’ll essentially earn 5.25% cash back in the category of your choice and 3.5% at grocery stores and wholesale clubs.

Sign-up bonus

When comparing the Citi Custom Cash versus the Bank of America Customized Rewards cards, the two cards have very similar sign-up bonuses.

The Citi Custom Cash is currently offering $200 (awarded as 20,000 ThankYou points) after spending $750 in the first three months of having the card.

The Bank of America Customized Rewards has a welcome offer of $200 if you spend $1,000 in the first 90 days of having the card.

While the spending threshold on the Bank of America Customized Rewards card is slightly higher, both welcome offers give the same bonus amount and relatively easy to obtain.

Redeeming cash back

Both the Bank of America Customized Rewards card and the Citi Custom Cash card allow you to redeem your cash back for checks, direct deposit or as a statement credit. Getting your cash as a statement credit is probably the simplest way to redeem your rewards, and there is no minimum amount to redeem for a statement credit.

As we mentioned earlier, with the Citi Custom Cash card, your cash back is actually paid out in the form of Citi ThankYou points. You can combine the ThankYou points you earn using the Custom Cash card with ThankYou points you earn with other Citi credit cards like the Citi Premier. This opens up another avenue to redeem the rewards you earn. At a rate of 1 cent per point, you can use your ThankYou points for travel or transfer them to Citi’s hotel and airline travel partners.

Since the Citi ThankYou points can be redeemed in a variety of ways, they are slightly more valuable than the Bank of America Customized Rewards’ cash back that are limited to only a few redemption options.

Other perks

The Citi Custom Cash card and Bank of America Customized Cash Rewards card are both very basic credit cards. They do not have a ton of other perks and benefits. One great feature is that both cards come with no annual fee. The Customized Cash Rewards card does offer an introductory 0% APR for 15 billing cycles for new purchases as well as balance transfers made within 60 days of opening the account, then 13.99% to 23.99% variable APR thereafter.

The Citi Custom Cash also offers a 0% intro APR for 15 months on both new purchases and balance transfers, as long as the balance transfers are performed in the first four months of account opening. Then the regular APR will be a variable 13.99% to 23.99%.

Citi Custom Cash Card: Best for lower spenders or those with very focused spending

The 5% cash back you earn with the Citi Custom Cash is limited to only the first $500 in spending each month. Any spending above that amount or in categories other than the one in which you spend the most only earns 1% cash back. Since 1% cash back is a fairly low cash back rate, it makes sense to focus your spending on the Custom Cash card in only one category each month, up to the $500.

Others who might consider the Citi Custom Cash card are those who have several different credit cards. If you plan to pair several credit cards, it may not be a big deal to spend in one category on the Citi Custom Cash card each month to snag the 5% rewards. If you can maximize the 5% rewards category each month, that’s an extra 30,000 ThankYou points or $300 each year.

Bank of America Customized Cash Rewards: Best for those with large deposit or investment accounts

Because of the power of the Bank of America Preferred Rewards program, the Bank of America Customized Cash Rewards is best for those who can deposit at least $100,000 with either Bank of America or Merrill. This will give you Platinum Honors status with Preferred Rewards and a 75% bonus on all rewards that you earn with the Customized Cash Rewards credit card. You’ll then earn 5.25% cash back in the category of your choice and 3.5% at grocery stores and wholesale clubs.

Even if you don’t have $100,000 to put away in a Bank of America account, at least $20,000 or $50,000 will also respectively qualify you for the Gold or Platinum tier. Though the increased rewards on those are lower, at 25% for Gold and 50% for Platinum, the Preferred Rewards does make the Customized Cash Rewards a more attractive option. If you don’t participate in the program at all, you only earn 2% and 3% in qualifying categories up to $2,500.

Bottom line

The Bank of America Customized Cash Rewards and Citi Custom Cash cards are both cash back credit cards that allow you to choose the spending categories where you can earn bonus rewards. If you know exactly which category you spend the most in, gas or dining or online shopping, the Customized Cash Rewards might be the better move – especially if you already have a good sum in a Bank of America or Merrill account to help boost your rewards.

For those who don’t spend as much or use multiple credit cards at a time to maximize rewards, the Citi Custom Cash card is also an excellent choice. Though the spend limit for the 5% cash back is rather low at $500, the Citi ThankYou points may be redeemed in so many ways, it gives the Custom Cash an extra edge in the competition. Both cards come with no annual fee, making them excellent cash back cards to consider. Which one is right for you will depend on your own specific spending habits.

Source: creditcards.com

Bank of America Premium Rewards card benefits guide

The Bank of America® Premium Rewards® credit card is a mid-tier travel credit card. At $95 per year, it earns 2 points per dollar on travel and dining purchases and 1.5 points per dollar on all other purchases.

The card also offers a few desirable perks, which can make it a solid choice for frequent travelers who don’t want to spend hundreds of dollars in annual fees on premium rewards cards. The benefits include TSA PreCheck or Global Entry credits, airline incidental credits, travel protections and more.

In this benefits guide, you’ll learn what the Bank of America Premium Rewards card has to offer and how you can use the card to maximize its value.

Bank of America Premium Rewards card benefits

For a credit card with a comparatively modest annual fee, the Bank of America Premium Rewards card has a few exciting things going on.

TSA PreCheck or Global Entry credits

Credits to reimburse the cost of a TSA PreCheck or Global Entry membership are a popular credit card perk among travelers. However, it’s typically associated with more expensive credit cards, such as the Chase Sapphire Reserve card, the Capital One Venture X Rewards Credit Card and The Platinum Card® from American Express.

See related: Best credit cards for expedited airport security screening

If like most travelers, you like the idea of expedited airport security screening, you can get up to $100 in statement credits for TSA PreCheck or Global Entry once every four years with the Bank of America Premium Rewards card. Considering that offsets the card’s fee, that’s an excellent deal.

Annual credits for airline incidentals

Another premium-level benefit on the Premium Rewards is statement credits for airline incidentals, such as checked bags and in-flight refreshments. Once again, this is a perk typically reserved for the most expensive travel card offerings.

The Amex Platinum, for instance, offers up to $200 in statement credits per calendar year on airline incidental charges. But Amex makes it somewhat complicated to use this benefit: You need to pick an eligible airline in January and stick to it throughout the year.

With the Bank of America Premium Rewards, on the other hand, you’ll get up to $100 in annual credit for airline incidentals which you’ll be able to use with any airline.

Not too bad for a mid-tier rewards card, especially considering the difference in annual fees – the Amex Platinum is a whopping $600 more expensive.

Travel protections

The Bank of America Premium Rewards also comes with some valuable travel protections, including:

  • Trip delay reimbursement, which allows a cardholder and their family members to receive coverage for delays in eligible cases.
  • Trip cancellation or interruption protection, which provides coverage for eligible prepaid travel expenses for canceled trips due to a covered reason.
  • Baggage delay insurance, which covers essential items when bags are delayed.
  • Lost baggage reimbursement, which covers luggage and its contents stolen or lost due to misdirection by an airline.
  • Emergency evacuation and transportation coverage, which covers eligible medical services and transportation if a cardholder or their family member is injured or sick while traveling.
  • Roadside dispatch program, which provides emergency roadside assistance.
  • Rental car insurance, which kicks in when you decline the collision damage waiver offered by the car rental agency.

Better rewards for Preferred Rewards program members

The Preferred Rewards program is available to Bank of America and Merrill customers with large checking, savings and investment account balances. The program offers appealing benefits like discounts on fees, higher rewards rates and interest rates on savings and more.

There are three tiers in the Preferred Rewards program, based on combined qualifying balances:

  • Gold – $20,000 to $49,999
  • Platinum – $50,000 to $99,999
  • Platinum Honors – $100,000

If your combined balances meet any of these thresholds, here are what your rewards rates on the Premium Rewards card may look like:

Preferred Rewards tier Points boost Points per $1 spent on travel and dining Points per dollar on general purchases
Not a Preferred Rewards member None 2 1.5
Gold 25% 2.5 1.875
Platinum 50% 3 2.25
Platinum Honors 75% 3.5 2.625

Simple rewards redemption

Speaking of rewards, the Premium Rewards card makes redeeming your points easy. You don’t have to worry about the point value – whichever redemption option you choose, you’ll get 1 cent per point.

You can redeem for travel, gift cards, statement credit or direct deposit. To pay for travel with points, you can use Bank of America’s Travel Center. Alternatively, you can get reimbursement for travel you’ve already purchased.

Unfortunately, Bank of America doesn’t have transfer partners, limiting your ability to maximize the point value. If you’re interested in transferring points, look into another mid-tier travel card, like the Chase Sapphire Preferred. At the same $95 per year, it offers outstanding perks and allows access to Chase Ultimate Rewards and the program’s excellent transfer partners.

No foreign transaction fees

The Bank of America Premium Rewards is also a good card to take with you abroad. Since it’s on the Visa network, it’s widely accepted internationally – and you won’t have to worry about foreign transaction fees.

Maximizing the Bank of America Premium Rewards card

Now that you know everything the Bank of America Premium Rewards card has to offer, you can get the most out of it.

Here are some tips to help you maximize the card’s potential:

  • Use the Premium Rewards on dining and travel – unless you have another card that earns more in these categories.
  • Use the card on general purchases outside of the bonus categories on your other cards to earn more than 1 point per dollar.
  • Read through terms and conditions to understand all travel protections available to you, as they sometimes can save you hundreds or even thousands of dollars.
  • Sign up for Global Entry or TSA PreCheck and make sure to use the Premium Rewards to pay for the membership.
  • Have the card handy when you travel to pay for airline incidentals and take advantage of the annual $100 credit.

Bottom line

For an affordable travel card, the Bank of America Premium Rewards credit card has plenty to offer, from popular perks like TSA PreCheck or Global Entry credits to less flashy but valuable benefits like rental car insurance.

If you already have the card, it’s a good idea to keep these benefits in mind so you can use it to its full potential. If you’re still shopping around, make sure to consider your options and see what kind of perks other similar cards provide.

Source: creditcards.com

5 Best Personal Loans for Fair Credit for 2020

Are you wondering if there are personal loans for fair credit out there?

If you are, then the answer is a resounding “Yes.” There are, indeed, personal loans for fair credit available to you.

If you have fair credit, expect your credit history to be under the microscope by lenders when applying for a personal loan. But that shouldn’t stop you from getting a personal loan.

So, how do you get a personal loan when you have a fair or average credit?

While you may have fewer options, the best way to know for sure what’s available to you is to shop around and compare.

In other words, there are lenders that are willing to get you a personal loan even if your credit is simply average. You just have to know where to look.

A simple internet search of “personal loans for fair credit” can return thousands of results. That can be overwhelming to go through everything.

But don’t worry.

This guide will provide you a selection of the best personal loans for fair credit. It will also show you ways to fix a fair credit score to a good or excellent credit score.

What is a fair credit score for purposes of getting a personal loan?

Before we offer you a list of personal loans for fair credit, you need to know what a fair credit score is.

A fair credit score, according to Credit Sesame, is a credit score within the range of 640 and 680. It sits “between bad and good credit.”

With an average credit score in the mid 600’s, you more likely to get a personal loan than those who have a poor or bad credit score (which usually ranges between 300 to 600).

But you will not enjoy the same interest rate that someone with an excellent credit score would.

Great interest rates are reserved for people with excellent credit score.

What is a personal loan and what can it be used for?

A personal loan is a lump sum of money you borrow from an institution, and then repay that amount (with interest) over a set period of time.

There are two types of personal loans: secured and unsecured. For example, if you’re taking a personal loan to pay off credit card debts or to go on a vacation, that loan is an unsecured debt.

On the other hand, if you’re taking a personal loan to finance a car, you’ve taken a secured loan that is guaranteed by collateral, which is the car your purchase. 

Unsecured loans have more risks for lenders, because there is no collateral. So, they have to rely solely on your credit history and other aspects of your financial life. That’s why it may be harder to get qualified for an unsecured personal loan with bad or fair credit.

Can I get a personal loan with a fair credit?

The answer is “yes.”

While there are plenty of personal loans for fair credit out there, it’s not always the best idea to apply. One reason is that you’ll often be charged a higher interest rate than someone with a good or excellent credit score. 

In that case, it could be worth raising your credit score first before applying for a personal loan.

So while there are lenders who are willing to offer personal loans to people with fair credit if you’re struggling to get approved for a personal loan with a fair credit, you may want to consider improving your credit score first.

Click to get approved for a personal loan now

5 Best Personal Loans for Fair Credit

The better your credit score, generally the higher your chance is for getting approved for a personal loan.

If you’ve got an average credit, you may still get a loan but you will get a high interest rate.

Check out the list below to see some personal loans you may be eligible for.

1. LendingTree

Part of your search for the best personal loans for fair credit should start with LendingTree.

That is because LendingTree is not a direct lender of personal loans, but instead it’s an online marketplace that matches borrowers to lenders based on your individual qualifications.

It saves you time. Instead of applying to several lenders, with LendingTree you can shop around and compare the best personal loans on one website. It’s an all-in-one platform.

It just connects you with multiple lenders, you can get a personal loan with even a 600 credit score. 

2. Avant

Avant targets people with bad and fair credit. So, that means even if you have a credit score as low as 580, you may still get qualified for a personal loan. The loan amount ranges from $2,000 to $35,000.

Plus, Avant provides quick funding for personal loans.

3. BadCreditLoans.com

Just like Lendingtree.com, BadCreditLoans.com is another online lending network that connects you to a huge selection of lenders.

These lenders specialize in lending personal loans to people with bad or fair credit. You can get a personal loan from up to $5,000.

4. Payoff

Payoff provides loans to borrowers who have a tons of credit card debts. If you have high interest credit card debts, a Payoff loan can help you consolidate them.

While you can get a Payoff personal loan with fair credit, the minimum credit score is around 640, which is on the higher end of a fair credit score.

So if you have a less-than-stellar credit, you may postpone your personal loan application.

5. Prosper

Another peer-to-peer lender to get a personal loan with fair credit is Prosper. With Prosper, not only can you get loan approval the same day, you can also get funding the same day.

But the main downside is that Prosper requires a minimum credit score of 640, which is on the higher end of a fair credit score range.

Other ways to find personal loans for fair credit

When you’re applying for a personal loan, don’t underestimate banks. The options above are online lenders. But banks and credit unions do provide personal loans to people with an average credit.

Banks.

This includes all the major banks, such as Chase, Wells Fargo, Citibank, Bank of America, plus other small banks.

The main benefit of visiting a bank when applying for a personal loan, especially with a fair credit, is that you get to speak with a human being and has the opportunity to explain your financial situation.

For example, you might be able to explain that the reason for an average credit score is due to an unexpected medical bill.

That is not possible with online lenders where it is an automated system that’s reviewing your finances.

It’s even better to get approved for a personal loan even with a fair credit if you have an account with that bank. They can see your transaction history.

The disadvantage, however, is that a bank may not offer the most competitive personal loan rate, especially with a fair credit.

Credit Unions

Part of your search for a personal loan with fair credit should also include credit unions.

Credit unions are not for profit organizations and are more willing to approve you.

But to get access to the best rate, you’ll have to become a member.

Peer-to-peer (P2P) Lenders

Another alternative to banks and credit unions, P2P lenders can provide you with a personal loan even if your credit is average.

For example, LendingClub, a popular P2P, can get you a personal loan with a credit score as low as 600 — which is considered fair credit.

However, your rate may not be as competitive.

Tips to fix a fair credit if you can’t get a personal loan

Holding off applying for a personal loan to improve your fair credit to an excellent one is a good idea.

Not only will you get qualified, but you’ll also get a better interest rate.

Follow these tips to improve your credit score.

1. Get a copy of your credit report

The first step is to obtain a copy of your credit report.

The three main ones to get it from are Transunion, Equifax, and Experian.

By law, you can request a credit report once every 12 months.

But if you want to do so more frequently, you can request it from free credit monitoring services such as Credit Sesame or Credit Karma.

2. Make sure there aren’t any mistakes

Once you get a free copy of your report, make sure there aren’t any inaccurate information or listings.

If you find something that you’re not familiar with, dispute it immediately.

Sometimes it can be a harmless mistake such as a misspelling or an issue that has already been resolved. Some other times, it can be something more serious such as a credit card or a loan taking out in your name.

So it’s important to always check so you’re not a victim of identity fraud.

3. Pay off any credit card debts

Some debts like student loans (as long as you’re not in default) may not have an impact on your credit score.

But if you have outstanding credit card debts, make it a priority to pay them off.

Or at the very least, pay them down until your balance is at or below 30%. That’s called “credit utilization rate,” which is a big factor in calculating your credit score.

4. Pay your bills on time

Nothing will tarnish your credit score like late payments. That is because payment history accounts for 35% of your total credit score.

Before a lender can provide you with a personal loan, (whether you have fair credit or not) they look at your entire credit history.

A late payment history does not look good. It tells them that you’re not responsible with your money. 

So make an effort to pay your bill on time, even if you can only make the minimum payment.

5. Don’t apply for new credit

When you’re improving a fair credit to good credit in order to get a personal loan, the last thing you want to do is to apply for new credit.

That’s because each time you do, you rack up what’s called a “hard inquiry.” Each hard inquiry is recorded on your report. And hard inquiry accounts for 30% of your credit score.

One hard inquiry is nothing to worry about. But when you make several within a short amount of time, you’ll hurt your credit score. It also tells lenders that you are desperate for credit.

Consider a co-signer

While it makes sense to raise your credit score before applying for a personal loan, sometimes you just need the money right away. 

If that’s the case and can’t get approved on your own, then you will need to use a co-signer with good credit.

With a fair credit, using a co-signer should be able to get you qualified for a personal loan.

But, bear in mind that this is a big financial burden you’re putting on them. By accepting to co-sign a loan, they are also responsible to pay off the loan if you cannot. So don’t take it personal if they say “no.”

Summary

Can I get a personal loan with fair credit? The answer is “yes.”  Personal loans for fair credit are available. And the list above have the best personal loans if you have fair credit.While there are several personal loans for fair credit, it’s not always the best idea as you will often charged a higher interest rate and fees. In this case, it makes sense to improve your credit score first before applying.

Click to get approved for a personal loan now

Work with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you save 100k (whether you need it to pay off debt, to invest, to buy a house, or plan for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

The post 5 Best Personal Loans for Fair Credit for 2020 appeared first on GrowthRapidly.

Source: growthrapidly.com

What is a balance transfer and how does it work?

If you’re dealing with pricey credit card debt, a balance transfer could be a useful tool in your debt reduction strategy. A balance transfer is the process of moving high-interest debt from one or more credit cards to a credit card with a lower interest rate.

A good balance transfer credit card can help you pay off debt faster, since more of your payments go toward the card’s principal balance each month instead of toward interest charges. It can also save you hundreds, if not thousands, of dollars in interest, given you’ll incur a low or even 0% APR on the transferred balance for a set period of time, usually six to 18 months.

Balance transfers, however, aren’t free. Most issuers charge a balance transfer fee, and there are other factors to consider before applying for a low or 0% interest credit card.

Here, we break down how balance transfers work and provide some tips on how to determine if this debt repayment strategy is right for you.

How balance transfers work

You generally apply for a balance transfer when you apply for a new credit card. You can also wait until after you’re approved for the card, though it’s best to get the process started as soon as possible. You’ll need to know the account number for your existing balance and how much you want to transfer.

Your new issuer may approve the full amount or only part of your balance transfer, depending on your credit limit and the issuer’s transfer limits. After the transfer is approved, issuers facilitate a payoff of the existing balance.

Some issuers send payment to the original creditor, while others require you to pay using a furnished balance transfer check. Once the transfer goes through, you’ll make payments to your new creditor.

Balance transfers are not instantaneous. Depending on the issuer and a number of other factors, your balance transfer could take three days to six weeks to complete. And while your credit card issuer should be able to give you a sense of how long it will take, there’s no way to know in advance exactly how long you’ll have to wait for the transfer.

In the meantime, be sure to pay at least the minimum due to your existing creditors. Failing to do so could lead to late fees and damaged credit and could even disrupt the balance transfer in progress.

Should you do a balance transfer?

A balance transfer can be a solid debt-repayment strategy, allowing you to save on interest and chip away at your balance over time, but it’s not the best option for everyone. Consider the following to be sure a balance transfer is right for you:

  • How much do you need to transfer? Even if you’re approved for a balance transfer card, the credit limit you’re offered may not cover the full balance you want to transfer. If your balance is too big to transfer all at once, you’ll have to decide if it’s best to transfer a portion, apply for multiple cards or work with your existing creditors to get a lower interest rate.
  • Do you have a repayment plan? It’s critical that you go into your balance transfer with a plan for how you’re going to pay off your debt and make the most of a card’s 0% introductory APR period or low ongoing APR. Otherwise, you may just find yourself back where you started. Additionally, if you don’t make timely payments, you could lose your 0% APR and may even trigger a penalty APR.
  • What got you into debt? You may be motivated to pay off your debt but if you haven’t addressed what caused you to get into debt in the first place, you might use your new card to create an even bigger balance. What’s worse, you could end up stuck with a high interest rate on your new card once the promotional period ends.
  • Good credit is required to qualify. To take advantage of the best balance transfer offers, you’ll need good to excellent credit. Instead of trying to do a balance transfer with bad credit, consider a debt consolidation loan or focus on paying down your balances as much as possible before you apply to rebuild your credit score and get better terms.

When a balance transfer makes sense

Though the specific terms will vary by credit card or issuer, there are two major benefits to electing for a balance transfer.

  • You can save money on interest. A balance transfer could save you a substantial amount of money. For example, if you were to pay 17% interest on a $2,000 debt making $60 minimum monthly payments, it would take close to four years to pay off the debt. Even worse, it would cost you more than $700 in interest. (Our balance transfer calculator can help you determine how much you could save with a top balance transfer offer.)  On the other hand, if you paid a 3% balance transfer fee ($60) and transferred your $2,000 balance to a card that charges 0% interest for 15 months, you could pay off your debt in 15 months with payments of about $138 per month, saving yourself a substantial sum in interest charges.
  • You can consolidate your debts. Transferring balances to a single low-interest credit card can not only save you money and help you pay off debt, but can also simplify your financial life. If you’re carrying high balances on multiple high-interest credit cards and have a hard time keeping payment due dates and minimum payments straight, you may end up accruing late fees. In that case, putting all your credit card debts on one card can be a good move, since you’ll have just one card to keep track of and one payment to make each month.

When a balance transfer doesn’t make sense

As we mentioned earlier, balance transfers aren’t free. There are important terms and conditions to familiarize yourself with before applying for one. Here are some balance transfer drawbacks to be aware of:

  • Fees are almost inevitable. Balance transfers can be a great way to save on interest and focus on paying down debt, but they come with a cost: You’ll almost always be charged a balance transfer fee, which is a percentage of the total amount you’re transferring. According to CreditCards.com research, the most typical balance transfer fee is 3%, but some cards charge 5%. For example, if your issuer charges a balance transfer fee of 3% and you transfer a $10,000 debt from another card, $300 will immediately be added to your transferred balance, bringing the total amount you owe to $10,300. There are a few credit cards with no balance transfer fee, but the tradeoff is usually a shorter 0% introductory APR period.
  • Promotional balance transfer APRs and transfer rates expire. A balance transfer card may woo you with its super-low or 0% introductory APR offer, but don’t be fooled: That “teaser rate” doesn’t last forever. After a set period – often six months to a year or occasionally more – the interest rate will increase to its regular rate, which could be even worse than the one you were trying to escape. You also don’t want to waste time getting the balance transfer process started. Some cards offer a lower balance transfer fee if you transfer the balance within a set period. If you aren’t proactive, you could end up seeing your balance transfer fee increase, which could cost you hundreds.
  • Multiple balance transfers can impact your credit score. You may think applying for a new balance transfer card when your teaser rate expires is the perfect solution to avoid ever paying interest on your credit card debt. While you can do that, know that multiple card applications can damage your overall credit score. When you continue to open new low-interest accounts but maintain high debt levels, lenders may see you as a risk, which will make it hard for you to borrow money for big-ticket items such as a home or car or even qualify for that second or third balance transfer card deal.

Bottom line

A balance transfer can be a useful tool to pay off credit card debt faster without incurring interest. But there are several things you need to consider to make a balance transfer work for you, including transfer fees and your financial habits.

Before starting a balance transfer, draw up a repayment plan to ensure you will pay off the balance before the introductory APR period ends. Also, avoid incurring more credit card debt. Otherwise, the benefits of a balance transfer may be null.

How to do a balance transfer by issuer

Visit the links below to do a balance transfer with your specific card issuer(s):

  • How to transfer a balance to a Chase credit card
  • How to transfer a balance to an American Express credit card
  • How to transfer a balance to a Discover credit card
  • How to transfer a balance to a Citi credit card
  • How to transfer a balance to a Wells Fargo credit card
  • How to transfer a balance to a Bank of America credit card
  • How to transfer a balance to a Capital One credit card
  • How to transfer a balance to a U.S. Bank credit card

Source: creditcards.com

8 tips for booking holiday travel this year

After putting travel plans on hold during the worst of the pandemic, many are venturing out to visit friends and family during the holiday season. Four in 10 Americans plan to travel between mid-November and mid-January, according to Deloitte. And high-income earners plan to take at least two to three trips during that period.

Vacation plans are on the rise again, and 61% of travelers are likely to spend more than usual, since most didn’t travel in 2020.

But this year, with increased travel, staff shortages and cancellations, travelers need to prepare for the unexpected. Part of that preparation should include utilizing benefits your credit card offers. Here are eight key ways to maximize the rewards your credit card offers for travel this holiday season.

8 tips for booking holiday travel

  • Use credit cards to protect against canceled flights
  • Book holiday travel during off-peak times
  • Layer loyalty and credit card rewards programs together
  • Let your credit card handle your lost luggage
  • Maximize your rewards when traveling for holidays
  • Utilize the insurance protections your credit cards offer
  • Book travel through credit card portals
  • Use the travel perks that come with your credit cards

Use credit cards to protect against canceled flights

Last year, about 281,000 flights were canceled – a marked increase from the previous year. In 2021, those flying to various destinations for the holidays can expect delays and cancellations. But the resulting stress of canceled and delayed flights could depend on the credit card you used to book your trip.

“Many premium travel cards offer built-in travel and lost luggage insurance, as long as you booked the flight with that particular card,” says Trip Savvy general manager Molly Fergus.

For example, the Chase Sapphire Preferred Card and Chase Sapphire Reserve Card offer up to $500 reimbursement for hotels and meals if your flight is delayed more than 12 hours or delayed overnight. Fergus has used this particular benefit several times when stuck overnight, which has more than paid for several years’ worth of the annual fee.

“It’s nice to have that peace of mind when booking,” says Fergus.

Book holiday travel during off-peak times

If you can swing it, book your holiday travel during periods when fewer people are traveling. For example, my family and I are flying out on Thanksgiving Day instead of on the Wednesday before the holiday – and saving approximately $300 per ticket.

The busiest travel days for Thanksgiving will be Wednesday, Nov. 24, and Sunday, Nov. 28, says Phil Dengler, co-owner of The Vacationer.com. For cheaper flights and less hassle, consider traveling on Monday, Nov. 22, or Tuesday, Nov. 23, and try to return home on Saturday, Nov. 27, or Monday, Nov. 29.

If booking Christmas travel, Dengler says Thursday, Dec. 23, and Monday, Dec. 27, are expected to be the busiest travel days. “Consider booking a flight and taking off a few days before December 23 for a cheaper rate,” he says, then flying back home on Tuesday or Wednesday, Dec. 28 or 29.

Layer loyalty and credit card rewards programs together

Many credit cards offer various perks and promotional rewards, especially during the holidays. Before you start booking flights, research your options thoroughly. “Combining loyalty and rewards programs will maximize your discounts and perks,” says Bank of America credit card executive Jason Gaughn.

“Make sure you’re enrolled in travel rewards programs that can help you earn points, cash back and special offers to use on future trips – such as airline, gas station, hotel, credit cards and banking rewards programs,” Gaughn says. “Be sure to use the popular web plug-ins and mobile apps that will scour online booking sites for all available discount codes.”

Gaughn advises using tools like a hotel, car rental or flight scanner app that allow you not only to compare available options, but also prices by booking company. To start earning rewards, make your purchases with a rewards credit card like the Bank of America® Customized Cash Rewards card, which offers 3% cash back on your choice of six spending categories that you can change each month, including travel and gas.

To maximize those earnings, Gaughn suggests layering in a banking rewards program. Bank of America’s Preferred Rewards program provides members a 25% to 75% credit card rewards bonus, which can boost your cash back earnings even higher, in addition to any other travel rewards benefits you may be earning.

Let your credit card handle your lost luggage

When flying try to pack light so your luggage is a carry-on for the flight. During the holiday, many will likely check their luggage. Losing luggage and all the bag’s contents, like clothing and other valuables (including gifts), isn’t a good feeling. However, many credit cards offer lost luggage protection when this scenario arises.

The Platinum Card® from American Express, for example, will reimburse cardholders for lost, damaged or stolen luggage up to $3,000 for a carry-on and $2,000 on checked baggage. Also, lower-tier American Express cards typically offer up to $500, but policies vary for each card. Remember to read the fine print if this is a benefit that’s important to you.

Maximize your rewards when traveling for holidays

The holiday season is a great time to use airline points and miles. “This is when flights are the busiest and most expensive, so your points will frequently go further,” says Fergus.

“If you have flexible points that can transfer to multiple carriers – such as Chase Ultimate Rewards, which can transfer 1:1 to several airline and hotel partners – check each airline’s miles availability before transferring your points.”

If award availability is offered at a reasonable cost, transfer your frequent flyer account first and then book a flight, rather than booking through a credit card portal.

Fergus suggests looking into business-class fares as well. Business-class award availability has been more open since the pandemic, she says: “You might be able to score a saver award in business class for just a few thousand more miles than an economy award ticket. That’s a much better value, not to mention a more enjoyable trip.”

Utilize the insurance protections your credit cards offer

Many travel credit cards offer rental car insurance so you can decline coverage at the rental counter. ”You’ll want to read the fine print very carefully to make sure you’re sufficiently covered, but the Chase Sapphire Preferred, for example, offers primary auto rental coverage up to the cash value of your rental vehicle,” says Fergus.

Capital One, Ink Business and American Express cards also offer cards enrolled in the car rental program.

Book travel through credit card portals

Booking your tickets through the credit card portal is a good option – especially if you are traveling on blackout dates, need multiple tickets on the same flight or trying to earn points or miles for your flight.

“Flyers should always check miles availability on partner carriers and find the best value for your points,” Fergus says. “You may find better value for business and first-class award tickets when booking directly through a carrier’s rewards program.”

Several credit card issuers have portals where you can book travel, often at significant discounts, including:

  • Chase Ultimate Rewards
  • American Express Travel
  • Citi ThankYou rewards
  • Capital One Travel
  • Bank of America Travel Center

If you are buying flights with cash then credit card portals are a great option. “Many of these offer bonus points for booking through the portals, so you’ll more quickly accumulate miles for your next reward flight,” says Fergus.

Use the travel perks that come with your credit cards

Some cards offer significant extras that you need to research so you can take advantage of them. For instance, “Most premium travel cards these days offer free Priority Pass membership, for access to select airport lounges, and credit for up to $100 to cover global entry applications,” says Fergus.

Some American Express cards offer monthly Uber credits, and hotel cards will offer food, drink and amenity credits during your stay. The Hilton Honors American Express Aspire* card, for example, bestows Diamond status on all its cardholders and offers a $250 resort credit at participating properties, a $100 food and beverage credit during stays and room upgrades when available. In one stay, you could easily recoup the hefty annual fee.

Bottom line

If you’re traveling for the holidays this year, try to minimize stress and maximize rewards. The best move: utilize credit cards to book your travel so they work to your advantage. Research your credit cards and determine how to make them work for you.

*All information about the Hilton Honors American Express Aspire card has been collected independently by CreditCards.com and has not been reviewed or approved by the issuer 

Source: creditcards.com

Bank of America Elite Visa Infinite Card – $550 Annual Fee, 50k Bonus, $300 Airline Incidental, $150 Lifestyle Credits & More

Update 11/21/21: An application page has been found. Might make sense to wait for the official landing page to come online before applying though. (Hat tip to JonLuca) Another Update: The terms indicate that the signup bonus is 50,000 points after $3,000 spend within 90 days.

More details emerge on the rumored upcoming Bank of America premium credit card from Reddit user AllHailMat. It’ll be called the Elite Visa Infinite card and will be available on November 22nd.

Bank of America Elite Visa Infinite

  • Signup bonus unknown
  • $550 annual fee
  • Up to $150 annually in statement credits for lifestyle conveniences, including streaming services, food delivery, fitness subscriptions and rideshare services. (applies to the following category codes: 4899,5399,5411,5422,5499,5691,5734,5815,5816,5817,5818,5921,5940,5964,5968,5969,5999,7032,7299,7372,7841,7997, and 7999)
  • Up to $300 annually in Airline Incidental Statement Credits for qualifying purchases like seat upgrades, baggage fees, in-flight services and airline lounge fees.
  • 20% savings on domestic and international airfare for any class when paying with points through the Bank of America Travel Center or concierge.
  • Up to $100 in statement credits for Global Entry or TSA PreCheck® application fees (every four years).
  • Card earnings:
    • 2 points for every dollar on travel and dining purchases
    • 1.5 points per dollar on all other purchases
    • Preferred Rewards members earn 25% – 75% more points on every purchase. This means clients could earn up to 3.5 points on travel and dining purchases, and up to 2.62 points on all other purchases, for every $1 they spend.
    • Clients can redeem points for travel, cash back, a statement credit, distinctive experiences or gift cards.
  • Free unlimited access to airport lounges worldwide with complimentary Priority Pass Select Membership.
  • Private flying with NetJets – purchase or redeem points for flight time, complimentary upgrades and additional perks.
  • Complimentary 24/7 full-service concierge to book travel, dinner reservations, event tickets and more.
  • Numerous additional benefits provided by Visa® such as the Visa Infinite Luxury Hotel Collection and additional travel benefits.
  • No foreign transaction fees.

Card will be available to current Octave Members between Oct 18 – Nov 22 and will be released to consumer clients on Nov. 22 and must be applied for with a financial solutions adviser. (Sounds like this card is not slated to be available online.)

Our Verdict

Seems like a souped up version of the Premium Rewards card: $200 more in airline incidental credits, $150 extra lifestyle credit, and a few other benefits. I like how they make the $150 lifestyle credits a bucket with a few options to make it useful for everyone. Still, I don’t see it being worth the extra $455 higher annual fee for most people. Maybe it’ll make sense for the signup bonus which we don’t know yet. And it possibly could make sense for some people for the 20% travel redemption discount.

Hat tip again to u/AllHailMat

Source: doctorofcredit.com