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Show BUSINESS Standard-Examiner Sunday, July 4, 1998 3& Getting bargain-price cards possible, not always easy Choose credit card thatis right for you Consider annual fees, interest rates, how much you spend, how much you can pay ers a chance to save a bundle. if you know where to look, what you need and howto ask the right questions. _ Falling interest rates and a pack ofagg resSive new issuers have rattled the old guard, which only a fewyears ago loaned credit at levels around 20 percent. Even Citibank, the Nation's biggest issuer, is Cutting interest rates and spicing up the deals onits cards. ‘| ‘f -f ing habits is thefirst step in picking the cor- fact that the rebate is meaningful,” says Gerri rect card. Do you really pay the bill off each Detweiler, executive director of Bankcard Holders of America month? Many consumerstry, but about 70 percent keep a balance from month to month Here are four descriptions of the typical card holder and what each should seek when hunting for plastic bargains: w Low spenders who don’t pay their cards off in full. w Heavy card users whopay their bills off monthly. The Bankcard Holders study said this group stands to benefit the most from the popular “frequent flyer” credit cards, which generally offer a roundtrip free ticket on a do- If you charge the average $2,200 a year and mestic flight after racking up $20,000 in char- carry a monthly balance of $1,100, look for a Finding which card is best for you requires some digging. About 5,700 banks issued cards with the Visa and MasterCard monikers in 1990. Manyof them have different features. doesn’t have a grace period, says Michael Auriemma, managing director of Auriemma Consulting Group, an industry consultant in ges. Interest rates and annual fees on these cards are high, so keeping a balance on the card can be costly For example, the average spender in the first example — $2,200 in charges and a cards, other credit card issuers are brawling to Westbury, N.Y. A grace period is the delay, usually 25 days, $1,100 balance — spends $219.40 a year for a Citibank AAdvantage card in interest and from the time of purchase and when the fees, while earning about 1/10th of a roundtrip ticket, the Bankcard Holders studysaid. Someone who pays off their bills every month, however, pays only the $50 annual Beyond the purveyors of Visas and Master- get their plastic into your wallet. American Express Co., for example, offers the Optima Card. Unlike the American Ex- press family of green, gold and platinum charge cards, which require you to pay your bill in full each month, you can keep a credit balance with the Optima card. The Discover Card, created by Sears, Roe- card with a low interest rate — even if it parking meter for interest starts ticking. Bank of New York Corp.’s standard Consumers Edge credit card, for example, has no grace period, but it also has no annual fee and the interest rate is low by the industry average — 11.9 percent. That card has gained increased acceptance w Active credit card spenders who tend to payoff their monthlybalance. This is the group that stands to benefit > partly through pioneeringthe allure of a renips bate incentive that gives customers cash re- wards, depending on how much they buy with the card. most from the new so-called rebate cards, such as the new General Motors, General Electric and Ford credit cards. Bankcard Holders of America, a consumer group in Herndon, Va., recently released a buck & Co., is another relative newcomer. among consumerssince its debut in 1986, uf. Robert McKinley, president of Ram Reuf search Inc., a Frederick, Md., concern that follows the credit card industry, says consumers essentially have two options. One type of card adds “some tangible benefit” such as a rebate or discount for a purchase, while the survey showing people who charge $4,000 a year — nearly double the national average — and payoff the balance in full can reap large benefits if they use rebates offered by these new cards. The Ford-Citibank credit card of- other type is a “stripped-down, plain vanilla fered $230 in rebates to consumers in this category, while the GM Card offered $200 cost. rebates and the GE Rewards Cardoffered $80 in rebates. card” that competes solely on interest-rate Making an honest appraisal of your spend- “What makes those cards good deals is the f eredit LrCUrt nierect card camn CaiCh ve rate card s ) me , c should I nders he Bde “Aa Closed. § even as low as 8 percent. Getting a i kn ain priced piece ofplastic isn’t always easy, however. The Bankcard Holders of America, a consumer group in Herndon. Va offers these tips, culled from cardissuing banks: gw Watch your overall debts. The group recommends consumers pay down existing debt to less than 35 percent of a household’s monthly funds aren‘t available to be tapped @ Don’t apply for too many cards. Limit applications for et 10 One Or two a six month period prior to submitting an applicat for a low-rate card w Check your credit report and fix anyerrors. w Stay put. It’s best to live at one address for one or two years before pretax income applying fee. mw People with poor credit or no credit histories. Use of secured credit cards, which require holders to deposit moneyin the issuing back equal to the card’s credit limit, are the best option. By having the deposits as collateral, banks can afford to accept people with shakier credit histories. Watch out for high annual fees, interest rates, and in some cases, application fees on game.Call ouroffice to start and stop your paperwhile you're away. secured cards. Bank of Hoven in South Dakota, for example, charges a $69 applicationfee, a $39 annual fee and a 21 percent interest rate on its card. Not all secured cards are that expensive. They also play a useful role. “They're a good wayfor students or people coming out of high schoolto establish a credit ONE CALL DOES IT ALL 625-4400 ©: STANDARD-EXAMINER Na “| 6 w-interest rate Cards. 7 Daven iJUEEHY NEWYORK (AP) — A competitive shak¢up in the credit card business offers consum- history,” said Steve Apesos, spokesman for MasterCard International. ee “ftems to check pture “when shopping Account Summary As OfJune 30, 1993 for credit card First unity The Associated Press A checklist of features to scrutinize when shopping for a credit tard. m The interest rate or annual percentage rate, known as the APR. In most cases, you’re paying too much if the interest rate on your card stands at 19.8 percent. A surveyin April by the Ram Research group showed credit card rates averaged 16.47 percent. mAnnual fee. Many card issuers charge an annual fee. Several groupssell lists of credit cards without annual fees and low interest rates. They are Ram Research, Frederick Md., $5, 1-800-344-7714: Bankcard Holders of America, Herndon, Va., $4; 1-800-553-8025. mService. A card that offers 24vhour service telephone number with real people answering the BEGINNING BALANCE may31.19%2 00 1 DEPOSIT (+) JUNE 01.1992. 10,000.00 0 WITHDRAWALS 6 | OTHERDEDUCTIONS () INTEREST PAID (+) JOHN DOE PO BOX 30006 ANYWHERE, UT 00 00 277.84 wRebates. The Discover Card helped popularize this feature, of- PLANNED SAVINGS PLUS SAVINGS MAIN OFFICE ACCOUNT 02 39225 6 JUNE 30,1993 PAGE 1 ST RATE 2.75% BEGINNING BALANCE may 31.1992 WIELD EARNED 2.78% 1 DEPOSIT (+) phones is a great benefit in the event of inadvertent problems with your card. Account Statement Bank; ENDING BALANCE JUNE 30.1993 uuneo1.1992 .00 10,000.00 0 WITHDRAWALS(-) 10,277.84 .00 OTHER DEDUCTIONS fering consumers a | percent rebate .00 for purchases exceeding $3,000. INTERESTPAID (+ This feature has expanded rapidly, enabling consumers to apply rebates toward a new car, an airplane fil ticket or discounts at their favorite stores. mGrace period. Most credit cards offer a grace period, which usually lasts 25 days from the time you use the card. That means the meter doesn’t start running on theinterest “fate until the grace period expires. Some new cards have no grace period, meaning interest is charged from the moment of purchase. Somecards charge interest immediately for cash advances — sometimes at a higher rate. INTEREST EARNED (2.90%) NIELDEARNED = (2.938) NDINGBALANCE RATE OF 3.15% EARNED 3.19% 293.16 ANNUAL PERCENTAGE YIELD EARNED 3.80% 10,293.16 10,319.00 ENDING BALANCE sune 30.1993 10,380.30 COSMAS HOSE ESEHEEHERESEREEEEOEEDE HEHE OES HSEEEOE a —. Lyn Allison, Optician Pick The Bank That Knows How To Make A Statement. Distinctive Fashion Eyewear Featuring: o LIZ CLAIBORNE © CHRISTIAN DIOR @ GUCCI © CAZAL © GIORGIO ARMANI AND MORE 479-1100 4387 HARRISON BLVD. HARRISON DEPOT oi Wehaven't found another bank in town paying a higherinterest rate on savings than we do. And you don’t even haveto take our word for it. By comparison, Planned Savings Plus Rates without naming Annual Interest names, you can see PercentageYield Rate thata First Security 2.75% Up to $1,000 $1,000 to $4,999 3.50% $5,000 to $99,999 3.75% $100,000 and up 2.75% Planned Savings 3.80 Plus account currentlyoffers the highestinterest rate for individual account holders Not onlydoesthis disciplined savings plan regularly shift moneyfrom your checking to your savings, you can make withdrawals at anytime. As your assets increase, so does your interest (upto 3.75 First Security Enroll in Planned Savings Plus and make your ownstatement. For moreinformation, stop into your local First Security branch,or call 1-800-574- Bank. CurrentlyGiving 10%. Member FDIC 6600. STOP, LOOK, and READ the STANDARD*EXAMINER. = | o-<Gigies >S ea ae -+ eee eee oe $4 =" = 3s 5 3 a > 3 So x S 5 Sateen eenSeue —Peezeesacnee em seeneeee CIAL SECURITY NUMBER 123-485-6789 a — Theserates are accurate as of June 25, 1993. Rates are subject to changeat any time after the account is open. The minimum balance to open this account is $50. hee & ACK : - |