Types of Credit Cards

Premium Credit Card

These cards offer incentives and benefits beyond that of a regular credit card. Examples of premium credit cards are Gold and Platinum cards that offer cash back, reward points, travel upgrades, and other rewards to cardholders. Premium cards can have higher fees and usually have minimum income and credit score requirements.

Both standard credit cards and premium credit cards have specific types of credit cards. Student credit cards, zero percent interest cards, and travel cards are just a few types available.

Limited Purpose Cards

Limited purpose credit cards can only be used at specific locations. Limited purpose cards are used like credit cards with a minimum payment and finance charge. Store credit cards and gas credit cards are examples of limited purpose credit cards.

Secured Credit Cards

Secured credit cards are an option for those without a credit history or those with blemished credit. Secured cards require a security deposit to be placed on the card. The credit limit on a secured credit card is equal to the amount of the deposit made. Secured credit cards have revolving balances depending on the purchases and payments made.

Charge Credit Cards

Charge cards do not have a credit limit. The balance on a charge card must be paid in full at the end of each month. Charge cards typically do not have a finance charge or minimum payment since the balance is to be paid in full. Late payments are subject to a fee, charge restrictions, or card cancellation depending on your card agreement.

Standard Credit Card

The most common type of credit card allows you to have a revolving balance up to a certain credit limit. Credit is used up when you make a purchase and made available again once you’ve made a payment. A finance charge is applied to outstanding balances at the end of each month. Credit cards have a minimum payment that must be paid by a certain due date to avoid late-payment penalties.

Business Credit Cards

A business credit card offers the business owner the opportunity to keep business and personal expenses separate. The credit card may offer special business rewards and saving opportunities that go above and beyond what the individual credit card owner may have.

Student Credit Cards

There are many companies or banks that offering a student credit cards. Most of the student credit cards are with lower credit limits and fewer incentives to help keep their spending in check. The averages credit balance of the college student’s graduate is between $3000 and $7000 and it has also interest rates that can be a real problem for the students.

Prepaid Debit Cards

With prepaid debit cards, you have actually prepaid and set the credit limit by depositing money onto the debit card. Depending on how much you have deposited into the debit card’s account depends on how much credit limit you want on that card. The similarities pf prepaid debit card to traditional credit they work the same when making purchase.

Credit Cards For Bad Credit

It is possible, even with bad credit to obtain a credit card. These cards will come with some restrictions not typically found on other types of credit cards. Your credit limit will be lower and your interest rate higher. Some may require you to have a secured credit card, meaning you have to maintain a savings or some other type of account that will cover the expenses on the credit card. Once you have established that you will be responsible, some, if not all, of your restrictions may be lifted.

Cash Back Credit Cards

Many credit cards will now offer you cash back incentives for using their credit cards. Depending on how much your balance is and how often you use the credit card, you can earn cash back for your purchases. Some companies offer 1% off your balance while others, like Sears, will offer you cash off purchases made in their store. Either way, if you are planning on using a credit card, finding one that will offer you a cash incentive is a smart choice.




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