Some things in life are expensive, like big family vacations, getting married and renovating your home. Worth it? Absolutely! But that leaves you with the question of how to pay for it.
Earning extra money with a second job or side hustle is a great way to pay down any debt as quickly as possible (without draining your savings). That savings is incredibly important when giving you peace of mind in case there’s a financial emergency, and it can impact your quality of life now and down the road (hello retirement).
That brings us to opening a credit card.
Finding the right credit card is a very personal financial decision. Every card is slightly different, and no one card is “right” for every person. But there are times when opening a credit card makes sense. Generally, a bigger purchase (like a vacation or home remodel) will get you to the minimum spending requirement in no time.
Signing up for a credit card comes with other benefits too. Convenience aside, you’ll boost your purchasing power while having some protection against credit card fraud. Credit cards can also be a great way to build credit over time. Simply making purchases and paying on time shows lenders you can responsibly handle money. On the flipside, maxing out your limit increases your credit utilization, which in turn will hurt your credit score. It’s all about balance.
Research before diving in
Once you’ve found a card that fits with your credit situation and spending habits, you’ll want to dig a little deeper into the fine print. Pay special attention to the fees — annual, late payment, cash advances or even transferring balances.
Be sure you understand the terms of any rewards or promotions, too. Many promotional offers are only available for a limited time (like introductory APRs). The IHMVCU Visa Credit Card currently offers 0% intro APR* through Jan. 31, 2023, meaning there’s no interest for a set period of time.
PRO TIP: PAY ON TIME Pay on time, in full. Once the intro APR period ends, any balance you carry will incur interest at the regular APR. It’s important to make sure your balance gets paid in full before the 0% APR ends, or you could wave bye-bye to any savings you may have received during the interest-free period.
Some things are just “worth it”
- Going on a big vacation
- Getting engaged/having a wedding
- Finally seeing your favorite team on their home turf
- Taking your kids to a water or amusement park
- Traveling to see a friend or family member
- Remodeling or renovating your home
How will you pay?
- Drain your savings (0 out of 10 – do not recommend)
- Earn extra money
- Open a credit card
*See full credit card disclosure (bit.ly/3xS8Ndw). Subject to credit approval. Excludes current IHMVCU credit card holders & Business credit cards. Balance transfer/cash advance/foreign transaction fee applies. Either $5 or 2% of the amount of each transaction, whichever is greater. 1% fee applies to all purchases and cash advances made in foreign countries in U.S. dollars and foreign currencies. Offer valid until January 31, 2023.