BY CRAIG ROPER
SENIOR VICE PRESIDENT, BRANCH AND
RELATIONSHIP BANKING, BANK OF UTAH
It’s not uncommon to open your mailbox and see one or two — or more — credit card offers, wanting you to apply. While you don’t have to know everything about every card on the market, it’s good to have an understanding of the different types of credit cards — 0% interest, rewards, cash back, travel, etc. — with the goal being to find a card that fits your overall financial goals.
Before you do, set expectations on how you will use your credit card:
• Get through an emergency.
• Build credit.
• Earn rewards.
• Pay down debt.
Now for an example of how a customer applied for and used a credit card in an emergency: On a cold day last winter, a customer came to the bank. His furnace had broken and needed to be replaced. An unexpected, costly expense, his first question was, “How am I going to pay for this?” He was working to build his savings and didn’t want to dip into that account just yet, but he couldn’t pay the full cost out of his regular spending budget either. He needed to somehow split the cost of the furnace up into manageable payments.
A strategically selected credit card from the bank that offered 0% annual percentage rate (APR) for the first 20 months. And, just as importantly, a carefully crafted repayment schedule to pay off the cost of the furnace well within the introductory period, interest-free.
Finally, when used intentionally and responsibly, credit cards can be valuable financial tools. One last piece of advice: Try not to use more than half of the credit available to you, and set rules and expectations on when it will be appropriate to use your credit card.
Go to bankofutah.com to learn more about accounts for children and students, or visit your local Bank of Utah branch.