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Credit Cards

Repair Your Credit

Your history of using credit cards and paying them on time can have a big impact on your FICO Score. If you don’t have an established a credit history or have a bad credit standing, getting and using a Secured Credit Card can be one of the best ways to establish, or re-establish, good credit.

A Secured Credit Card has its credit limit ‘secured’ by a security deposit made by the consumer into special savings account. The available credit limit is based on how large the security deposit is. You are likely to be approved for a Secured Credit Card since most don’t require a co-applicant, but all require the establishment of the security deposit. If a Secured Credit Card is reported to the three major credit bureaus, it is reported the same as any other credit card.

In contrast, a Prepaid Debit Card (sometimes simply called a “Prepaid Card”) is a variation of a debit card where the funds available for purchases have been pre-loaded onto the card. It functions in a transaction the same as a debit card for a checking account. Common types of Prepaid Debit Cards are gift cards and rebate cards. Some parents will provide their teenagers with Prepaid Debit Cards issued by Visa, MasterCard or American Express as a means to teach responsible card-based purchasing habits without the parent having to complete each transaction. However, unlike most Secured Credit Cards, a Prepaid Debit Card is not reported to the credit bureaus and its use will not have any impact on your credit standing.

Consolidate Credit Card Debt

If you have large balances across multiple credit cards, consolidating those balances onto a single card with a lower interest rate and fees can make that debt easier to manage and pay down. Balance Transfer Cards often have low introductory interest rates and fees for transferring balances from other cards. Look closely at all terms and fees on a Balance Transfer Card, including those for new purchases, to make sure that how you plan to pay down the consolidated debt and use the card will enable you to save money without incurring additional fees or interest.