5 signs your credit card sucks

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If your credit card sucks, it belongs hereWhen it comes to choosing the right credit card, you’ve got plenty of options. A good card can give you a long promotional period, a great interest rate and reward you with some nice benefits. On the other hand, a bad card at best takes up undeserved space in your wallet, like so many stripes of vanilla ice cream in a carton of neapolitan, and at worst can result in larger balances and serious financial damage.

If you’ve made some uninformed decisions in the past and put the wrong cards in your wallet, now is the time to make the switch. Here are five telltale signs that your credit card sucks.

1. Lame rewards programs
Cash back and other rewards programs are great ways to cut your credit card balance and save on things like airline flights and hotel stays. If your card offers no rewards points or cash back, however – or even a measly 1 percent — it might be time to look elsewhere. Some cards feature as much 5 percent cash back on various spending categories throughout the year such as movies, restaurants, and Internet shopping.

2. High fees
Some credit card providers do a good job of keeping fees to a minimum, while others nickel and dime you to death. If you hold a card with an annual fee, foreign transaction fees, over limit fees and so on, examine whether the benefits you get are really worth the expense in real dollar terms.

3. Exorbitant APR If you pay your balances off every month, you don’t have to worry about interest rates. If you don’t, however, you are throwing money away on any card with a high APR. The main thing that triggers your rate on a credit card is your credit score, but some cards do offer lower rates than others, all things being equal. Right now it’s possible to find APRs starting as low as 10.99 percent on some cards, so shop around.

4. Changing due dates
Ever get charged a late fee because you noticed after the fact that your issuer changed your due date on you? If so, the issuer probably notified you in one of those “updates to your account” letters that rarely gets read. This is a sure sign your credit card sucks. If it has ever happened to you, “fire” your credit card provider immediately and get a new one with more ethical policies. If it’s a credit card that has advantages you like and need, simply pay better attention when your bill comes in the mail and always make sure your payment is sent in well before the due date.

5. Crappy customer service
Ever try to call customer service only to be put on hold for an extended period of time? What about an elaborate phone tree where you can’t get to an actual human? If you’re wasting hours of your valuable time just trying to get the answers you need about your credit card account, find a company that takes better care of its customers. In a recent study conducted by J.D. Power on credit card customer satisfaction, American Express and Discover occupied the top two spots.

Now that we’ve determined whether or not your credit cards suck, let’s talk about how to use the good ones effectively. If you currently have balances, wipe them from your slate as quickly as possible and commit to never carrying them again, completely eliminating the need to search for a card with a low APR. Look for ways to reduce your monthly bills or simply rein in your spending until they’re history. Identifying whether or not your card sucks is important, but when you find one that doesn’t, it’s just as important to make sure you use it prudently.

What do you think? How do you determine whether a credit card sucks?

John Parker is a writer who focuses on covering trends in the financial space — including credit cards, mortgages, real estate and banking.

(Photo: Ben Schumin)

{ 15 comments, please add your thoughts now! }

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15 Responses to “5 signs your credit card sucks”

  1. Glenn Lasher says:

    I have one with no rewards, but I’ll take that because the total lack of fees and the really good APR are reward enough.

    Don’t fall into the trap of thinking the rewards program needs to be awesome, or even exist at all, for a card to be worth having.

  2. NuMexMike says:

    Good suggestions, but I believe a federal law known as the Credit Card Act of 2009 established a rule that requires credit card companies to keep and maintain the same due date each month for payments.

  3. Syed says:

    Pretty much covers it all. Having a good rewards programs can put at least a couple of hundred tax free dollars in your account every year.

    • Tim says:

      @Syed, this is the same misplaced belief credit card companies want you to think in choosing their card for “rewards” or “cash back”. The fact is, consumers buy more for the rewards or cash back, and if you carry a balance, that means greater profits for the card company (yes, for those who pay off monthly, the card company is still making the vendor transaction fee). Many have a minimum amount required before you can redeem a reward or cash, and many have increased the back end cost (e.g. more points to redeem) effectively decreasing the reward or cash back value, while others have you paying upfront and don’t reimburse until the end of the year.

      • BillyBob says:

        My credit cards have been a true source of income. I have gotten scads of free hotel rooms, flights, cash back, and have never paid a dime in interest or fees. The only card I have for which I pay a fee is the United card (I fly a lot) and the IHG card for the free night for $49. I churn what I can too and get lots of $100 or $200 cash for first use or after spending $500/$1000 in 90 days, things like that. However, I am sure for every one of me, there are 20 others who pay fees/interest. It’s a transfer mechanism then from those who are not financially responsible to those (like me) who are financially responsible.

  4. freeby50 says:

    You often can’t avoid both 1 and 3. From what I’ve seen the cards with good rewards often won’t have good APR and the very low APR cards don’t have good rewards.

  5. Tim says:

    I’m finding it increasingly more time and energy consuming to figure out the best card to use, since issuers are changing their programs so often. One issuer says they are committed to keeping the amount you get back on purchases, but sneakily changed the number of points required to redeem. Other issuers have periodic point increases, etc. It gets old. I mean, i have a little sticky note in my wallet with a point matrix so I know what to use when and where. that’s a bit ridiculous.

  6. scott grover says:

    Amazon Visa: 3% back on all purchases at amazon.

    1-2% baxk on everything else.

    • Tim says:

      if you use amazon, it works well, otherwise, it’s basically a Chase rewards card and the constraints with it.

  7. How about this: you used your card at Target during the ‘hack period’. 🙂

  8. I like it if a credit card has no annual fee and has the lowest interest rate compare to other cards out there.

  9. Karl says:

    APR seems irrelevant. Pay off every month. If you can’t then don’t use it.

    1.Lack of debt equals freedom.
    2.Stop feeding the beast: less interest to big banks means less influence on politicians by them which allows them to listen to us

    (don’t bother telling me easy for me…. I know there are people that are in really tough spots that have no choice…but the ones that I know that have credit card balances are not in a tough spot.…also it seems to me that there are a lot of voices pandering to the public and few that tell them to cut back…..cut back as its not hard and you will be free!)

    • Tim says:

      agree with the APR, but disagree with lack of debt = freedom. There are times when carrying debt is more beneficial. I see no reason to use cash to pay for something I can earn more than it costs me to borrow. Of course, not everyone is comfortable with this.

  10. Marc says:

    Whenever I am going to pull out my debit card, I use my Credit Card. And pay it off in full every month. I only buy things that are on my budget. My lifestyle is modest and I earn 2 $100.00 Shell gas cards every year.

    Plus charging on the credit card gives more security if something goes sideways. Cannot recall the last time I used my Debit Card.

    I do not care about the APR, though it is low through my credit union and I am not going to pay and carry cash. Been doing this since 2005.

    Hey,I will also switch Rx refills to get the bonus $25 x 2 promo, that is offered every 6 months. Plus cost of time and travel is minimal for all of this.

  11. Wilma says:

    I use my card to get credit on my report and pay it off monthly. The card companies change their programs like I change my socks and undies. Not worth my time to investigate or switch over. The rules for those rewards are against you any how and change often. Finances are tough enough to balance and maintain I don’t need to be chasing after the latest deal in cards too.

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