Personal Finance

5 Top Credit Card Questions: Answered by an Expert

I get a new credit card offer almost every day. They are all full of big promises like 0% interest, travel rewards, or making me feel really special because the card is gold or see-through or some other gimmick. With so many different cards, how to do you choose the right one for you? I got Chris Mettler, president and founder of Compare Cards to help answer some of the top credit card questions out there so that you don’t end up with a fancy gold credit card that leads you into some not-so-cute debt:

1. What credit card features are most important for students while they’re in school? Is there one particular card that is considered the best for students?

The most important issues facing students using credit cards are to (1) make sure that they make their credit card payments on-time and (2) that they don’t view access to credit card as “free money”.

I know when I received my first credit card in college, I looked at it as an opportunity to spend.  I considered my credit card as something which “I can just pay off when I feel like it”. Fortunately, a few years after college, I received some great debt management advice to utilize before every credit card transaction – “do I have enough cash in my checking account to pay for this? If so, what benefit do I really get out of using my credit card for this?” If I saw REAL value in points for the purchase or just to be able to pay a little later in the month, then I would put it on credit.

Really most student credit cards are very similar. It’s important to view a student credit card as a starting place toward establishing your “credit life”. If you make the investment up front (i.e. sound credit management practices), you will benefit later in life (i.e. mortgage approval).

2. What would you say is the biggest mistake people make when choosing a credit card?

I see a lot of people focus too much on the annual fee of a credit card offer versus the true benefits of the credit card. With the recent banking legislation from Congress, banks must charge annual fees in order to make their credit card products profitable. While many credit card issuers don’t charge an annual fee for cardholders with excellent credit, the days of single digit interest rates and no annual fees just don’t exist anymore. A fee of $49, per year, with access to a lucrative rewards program, makes sense to me but some people just can’t get over that hurdle. Of course, paying a hefty annual fee and not using your credit card enough to justify a fee like that, doesn’t make sense either.

3. Would you recommend the cards that offer a 0% introductory offer?

Yes, indeed, especially the ones which offer 0% on balance transfers. Most people really don’t realize how much interest expense they pay on outstanding credit card balances. Introductory 0% credit card offers can save people several hundreds of dollars in interest over a given year. I look at people who don’t take advantage of these opportunities as just throwing money away. I’m sure they could have used that lost income for several other more worthwhile things. 0% on purchases is an attractive product, especially if someone is looking to make a major purchase; however, these incentives should only be applied if someone is going to actively look to pay off their purchases and don’t simply view it as an opportunity to live beyond their means.

4. Is there a particular company (Visa, MasterCard, Amex) that is considered the best or most trustworthy?

All of the processors are pretty equal in terms of being trustworthy. Hands down, American Express has the strongest awareness and most exclusive brand in the credit card industry. Many people are simply willing to pay more just to have access to an American Express card.

5. Is it a mistake to choose a card simply because of an amazing bonus offer like cash back or extra points?

I think it depends on whether or not you are aware of the regular interest rate of the credit card and how important that is to you. I pay off my credit card bill every month, so I’m not worried about a high variable interest rate (+18%). For this reason, my choice of credit card is always the one with an attractive bonus offer, such as a sign-up bonus based on a minimum purchase thresh-hold or more points per dollar spent. Consumers should always be shopping for the credit product which puts each and every dollar they spend to better use – in other words, cash coming back to them!

Chris Mettler is the president and founder of Compare Cards and has been educating consumer on managing credit and personal finances for over 10 years.  Compare Cards offers simple solutions for finding the right personal, business or student credit card at

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