5 Things to Know Before You Get a Credit Card

Article originally published on April 25, 2018 and refreshed on March 18, 2021.

Personal finances are just that — personal. They look different for every person at every stage of life. But even as life circumstances and spending habits change, many people stick with the same credit card.

A recent CreditCards.com survey found that 30% of U.S. credit card holders have never changed their go-to card. These consumers may be missing out on possible rewards or paying too much in interest simply because the card they are using is no longer the best fit for their current life situation.

For instance, the basic credit card that you could qualify for as a college student may not offer the rewards that you could be racking up as a working professional who travels frequently.

Freshen up your finances by getting a credit card that works for you now. Credit card offers run the gamut of interest rates, rewards offerings and terms.

Here are five things you should know before signing up for a new credit card.

Credit card tip #1: Know your credit score

When applying for a credit card, the issuer will look at your credit history and credit score. Your credit score will impact not only whether you qualify for a given card, but also the interest rate and terms offered to you.

Before you apply for a credit card, you should have a good idea of where your credit score stands. You’re entitled to a free copy of your credit report from each of the three major reporting companies — Equifax, Experian, and TransUnion — every week during the COVID-19 pandemic. If you have not checked your credit score within the last year, request a free copy at AnnualCreditReport.com. 

Credit card tip #2: Know how you're going to use the card

Do you plan to use the credit card as a loan to pay off a large purchase over time? If so, opt for a low interest rate credit card like the Zions Bank Clarity Visa^® Credit Card*. If you expect to pay off the card’s balance in full every month, a rewards card makes more sense.

Generally, you trade one perk for another — rewards cards typically have higher interest rates, while low-interest cards tend to offer fewer rewards.

Some cards offer greater rewards on certain types of purchases, like travel or gasoline. For example, the Zions Bank Vivid Rewards Visa^® Credit Card* offers 3 points per $1 spent in categories including dining, entertainment, transportation and digital services. If cash back is more appealing, the Zions Bank Agility Cash Visa^® Credit Card*offers 1.5% cash back on every card purchase.

Credit card tip #3: ‎Know the terms and conditions

Behind every enticing credit card offer is a lengthy list of rules and guidelines governing the card. Thankfully, credit card issuers are required to present these legal disclosures in a standardized box, known as the Schumer Box, which makes it relatively easy to compare cards in a uniform way.

The terms and conditions will spell out the annual percentage rate or APR (which will vary based on your credit worthiness) and how it is applied to purchases and other transactions, such as cash advances and balance transfers. Pay special attention to promotional periods and what happens with introductory rates once they end.

Credit card tip #4: Know the fees

To understand a credit card’s true cost, weigh possible fees against benefits and rewards. Cards that come with annuals fees should offer extra benefits to justify the added cost. If you’re looking for a card with no annual fee and competitive rewards, check out Zions Bank Visa® Credit Cards*.

Most credit cards will charge late fees, returned payment fees and cash-advance fees. More obscure fees to watch out for include reward redemption fees, foreign transaction fees, activity fees and payment protection fees.

Credit card tip #5: Know how rewards are applied

You can generally apply credit card rewards in one of three ways: turn them in for cash, earn a statement credit, or apply rewards towards a purchase. But some credit cards make it more difficult than others to earn and redeem rewards.

Some issuers will require you to earn a minimum number of rewards on your credit card in order to cash in. Others may impose limits on how much you can earn in a certain category during a given time frame. Still others mail out your rewards once a year in a predetermined time period, and clients cannot access them outside of this window. If you close the card during the year, you forfeit all the rewards.

Before committing to a card, find out how you redeem reward points and whether they expire. If you’re earning cash back, how and when do you get it?

Not sure which credit card is right for you?

At whatever stage you find yourself in life, a Zions Bank credit card can help you maximize your purchasing power and manage your finances. Compare the Zions Bank Visa® Credit Card* offerings on our website to find the card that best fits your lifestyle.

*Credit cards are subject to credit approval. Terms, conditions and restrictions apply. See banker for details.