Our founder, Carlos Hernandez, recently had the opportunity to sit down with Latina personal finance expert and the founder of Yo Quiero Dinero Podcast to discuss which credit cards she uses in her personal and business life.
Using information from the credit card reviews found on Crediverso’s credit card comparison marketplace, Carlos talks through every credit card Jannese has in her wallet, what she’s doing well, and what she can start doing right now to put more money back in her wallet.
Carlos: This is a great travel card because it doesn’t have an annual fee or a foreign transaction fee. The APR is reasonable, ranging from 15.74% – 24.74%, and you get complimentary Hilton Honors Silver Status just for signing up. You also get perks like a late checkout, a 20% points bonus when you spend at Hilton resorts, and no resort fees on stays that you book through your rewards points.
Jannese: Is there a sign-up bonus?
Carlos: Yes, if you spend $1,000 on the card in your first three months you’ll get a sign-up bonus of 75,000 miles. However, that’s really only worth about $450, and that’s pretty low in terms of sign-up bonuses you’ll see for some other travel cards.
Jannese: What if I’m having trouble hitting my sign-up bonus because I’m not traveling right now due to COVID-19?
Carlos: American Express actually announced a policy that said anyone who was approved for a card between Dec. 1, 2019 and May 31, 2020 has been given an extra three months to hit the spending amount required to earn a bonus.
Suncoast Rewards Platinum Visa is a large credit card payments processor.
Carlos: This is a good example of a credit union card. Before you use a credit union card, you should make sure to understand the difference between a credit union and a bank. A credit union is a member-owned, non-profit bank. Because they don’t have to give profits to shareholders, they usually have lower annual fees, lower late fees, lower foreign transaction fees, and lower Your balance is how much you still owe your credit card provider for things you've charged... transfer fees. The average APR is around 11% or 12% whereas a bank’s average APR is closer to 16%.
Jannese: So are credit unions always better than banks?
Carlos: Not necessarily. Credit unions typically have fewer customer service employees, so it can be harder to get help when you need it. They also have lower credit limits and fewer rewards. Lastly, watch out for something called “cross-collateralization” if you take out another loan with the same credit union. If you have an auto loan and a credit card for example, and you don’t pay your credit card bill, the credit union might be able to repossess your car.
Jannese: Are credit unions federally insured the same way banks are?
Carlos: When you deposit your money at a regular bank, it is federally insured by the FDIC (The FDIC is a federal agency that protects your rights and supervises banks.). This means that if the bank goes under, your money is protected. People often ask if credit unions are federally insured too. The answer is yes. Credit unions are federally insured by the National Credit Union Share Insurance Fund, and they are just as safe as regular banks.
Jannese: How do I know if I’m eligible for a credit union credit card?
Carlos: you can check here whether you are eligible to become a member of a credit union.
Carlos: This is a great balance transfer card. For people who don’t know what that is, a balance transfer card lets you take your outstanding debt from one credit card (that has a high interest rate) and move it to another that has a lower interest rate. You’ll usually have to pay a transaction fee of between 3% – 5% of the total amount being transferred, but depending on your interest rate this can still save you a lot of money.
Jannese: So is this a good balance transfer card?
Carlos: yes, it is. This card doesn’t charge a balance transfer fee, even though most cards charge at least 3%.
Jannese: How do I do a balance transfer?
Carlos: There are a few steps to doing a balance transfer.
Step 1: Determine whether you need a balance transfer. Do you have a large outstanding balance on one or more credit cards? Pro tip: you can often move personal loan balances or even auto loan balances onto balance transfer cards.
Step 2: Pick a balance transfer card. Crediverso has a huge selection of balance transfer cards. Try to find one with no annual fee and a long 0% interest introductory period. Most balance transfer cards have between 12 – 15 months of 0% interest. The longer the better.
Step 3: Apply for your new balance transfer card. You can do this right from our website by clicking the “Apply Now” button in any card review. Pro tip: you can’t transfer a balance between cards from the same card issuer, so make sure to pick a different issuer for your new card.
Step 4: Transfer your outstanding balance to your new card. You can do this online or over the phone, but make sure you have the account information from your original card.
Step 5: Start using your new balance transfer card. The transfer might take 2-3 weeks to be finalized, so in the meantime make sure you keep making payments on your old card. Pro tip: APR’s can be high after the initial period, so try to pay your balance down during the 0% interest intro period.
Carlos: This is one of the most popular credit cards around, and it’s really good for frequent travelers. It has a high annual fee of $550 and you need an excellent credit score (over 720) to qualify, but you get lots of perks like access to over 1,000 airport lounges worldwide and a complimentary DashPass and Lyft Pink subscription.
Jannese: Does it make sense for me to have a travel credit card during a pandemic, when I can’t travel?
Carlos: Good question. Since canceling a credit card can hurt your credit score, my advice is to think about your other options before you cancel. You can begin by calling your credit card provider and asking if they have any retention bonuses to convince you to stay. You can also always downgrade to a less expensive card. The Chase Sapphire Preferred card has a much lower annual fee of $95. The benefit of downgrading is that you don’t get the negative credit score hit of canceling your card, but the drawback is that you can’t take advantage of any of the big welcome bonuses for the Chase Sapphire Preferred.
Chase Amazon Rewards
Carlos: If you shop on Amazon, you should absolutely have one of these cards. They have no annual fee and give you 5% back at Amazon and Wholefoods if you have Amazon Prime or 3% back if you don’t. They also require excellent credit, and of course always be sure to use the card responsibly by paying on time, in full, every month to avoid interest.
Jannese: How should I use the Chase Amazon Rewards card?
Carlos: Well, for starters you should make sure to do all your Amazon and Wholefoods shopping on this card since you’re getting such a good cash back rate. For all other purchases, you might get a better rewards rate with another credit card – here you’ll only get 1% or 2%. For example, since you have the Chase Sapphire, you can get 3x points on dining, so you should use that card when eating out.
Capital One Spark Business Card
Carlos: If you have a small business, you should have a small business credit card. This one is a good choice because it is easy to use – it gives you 2% cash back on everything. A lot of other business cash back cards have different rewards rates depending on the category, and that can get really complicated.
Jannese: Are there any drawbacks to this card?
Carlos: Well there is an annual fee of $95 starting in the second year, and the APR is pretty high at 20.99%. But the upside is that they won’t charge you to issue extra cards for your employees, and your employees will all get the same 2% cash back deal. If you’re concerned about the annual fee, the Capital One® Spark® Cash Select for Business has no annual fee, but the cash back rate is lower at 1.5%. If you’re having trouble qualifying for either of those cards, try the Capital One® Spark® Classic for Business, which only requires fair credit and has a cash back rate of 1%.
To listen to the full episode, visit Yo Quiero Dinero’s webpage.