84. How to Choose the Best Credit Card

April 20, 2023

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The following article may contain affiliate links or sponsored content. This doesn’t cost you anything, and shopping or using our affiliate partners is a way to support our mission. I will never work with a brand or showcase a product that I don’t personally use or believe in.

A credit card might be one of your best financial tools

When it comes to credit, there’s no real way around it –– you need it. From applying for an apartment to buying a car (unless you’re paying cash), to sometimes even getting your utilities turned on, you’re likely to need some form of credit to help you get ahead in the United States. 

In this solo episode, Tori guides you through some of the most commonly asked questions we get about credit cards, including:

  • How do I choose the best credit card?

  • How do I use a credit card responsibly?

  • How do I choose the right “rewards” for myself?

Additional Resources:

Our Credit Card Recomendations

Episode: What Credit Card Companies Don’t Want You to Know with Vrinda Gupta 

How to Build Credit Using Credit Cards

Why You Need a Credit Score


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[00:00:00] Tori Dunlap: It’s gonna be stuck in my head all day. Hello, if Kristen did not cut that we have been rewatching community. Hello financial Feminist. My name. I was gonna say, my name is Tori Dunlap, but you probably already know that I’m getting back from vacation. I don’t know. I don’t know if that was clear because this is, The wont start to an episode.

[00:00:44] Also, we just got back from a lot of book events, which were very exciting. It was lovely meeting all of you. I kind of, hold on. Can I go grab it? I’m gonna go grab it. Give me one second. You can keep this in. Hold on to the person who made me a Timothy Chae. Bless you. I almost cried. He went to dinner with me that night.

[00:01:04] We, this was in New York. And, uh, the lovely part about these events that I get to meet you all, we do like a 45 minute hour conversation or workshop, and then I get to sign your books and meet you. Also, we have book tour stops coming up, so her first a hundred k.com/events, but somebody in New York gave me a Timothy Sha.

[00:01:22] And I look on TikTok. We’ll post the video. He is from Dune. He looks like a Funko, but he is a little teeny tiny and honestly, I’m living for it and I was just very excited. So, um, I think he should sit on my desk. He was over with. My other Timothy shall my memorabilia, but I think he should sit on my desk.

[00:01:41] So this is a long about way of saying for those of you I met, makes me so happy. It’s so happy to meet you in person. It’s so happy to sign your book and see how our movement has connected with you. And the vast majority of you, uh, actually discovered us from the podcast or side of the podcast is the reason that you’re here.

[00:01:59] So, uh, we just are so thankful for that and. Always just glad that this podcast continues to connect with you. And speaking of community, we have a fun little surprise voicemail that I have not heard yet, so I’m excited to listen to it live. Okay, so this voicemail is from Ariana. Hey, 

[00:02:17] Voicemail: so, um, the two major podcasts I listened to are you, which thank you so much, you’ve changed my life and the 10 Savage Savage Lovecast, and on his.

[00:02:27] Uh, podcast, they do listener response calls where listeners, you know, respond to the voicemails that they hear from his podcast. And I just wanted to, um, reach out to the grad student in Chicago who’s feeling guilty. Oh, about not saving. And I just wanna say that I was in a similar boat. I moved outta my parents pa place for the first time and I moved to a very expensive city, um, in Vancouver.

[00:02:52] So, you know, like a really expensive city and I was making like nothing as a grad student, like less than you. Um, but my rent was a little less. So same, same. But yeah, like it was really hard not being able to save money and then feeling guilty like, oh, my friends are going out for food. And like, that’s the thing you do in Vancouver.

[00:03:07] Like the food’s amazing. But now I’m on the other side of grad school, like it helped me get a better job with, uh, higher compensation rate, like right out of the gate. And so like, it’s okay, like I’m saving a lot of money now that I definitely couldn’t have done when I was in school. And obviously that’s thanks to Tori and all of her.

[00:03:26] Um, advice. So just like, just be a grad student. Enjoy the time as much as you can, and then when you enter the workforce, like worry about it then, but I promise you’re good. 

[00:03:36] Tori Dunlap: I love this cuz this is a response to our most recent episode where I did and asked Tori q and a and this lovely person was in grad school and was like, I basically feel guilty for not saving and then I feel guilty for spending and then I feel guilty for everything.

[00:03:50] And my response to her was like, if you can find a. Do it, but also like you’re in school. That’s okay. That’s what you’re there for. And I love that this person literally is just like responding to the voicemail with a voicemail, and that’s just so kind. So if you have a voicemail for us or a question that you want answered, but also if you just wanna like respond to somebody else’s voice.

[00:04:09] Fail, bring it on. This is great and this is the kind of community we wanna foster. And so I love that. Uh, maybe these two people can connect. I don’t know. We’ll figure that out. We can liaison that. Okay. We are talking about one of the most common questions we get, which is. What credit card is right for me?

[00:04:26] Do I need a credit card? What are the, the credit card options and benefits? And we’re going to give you basically the complete guide to credit cards today. I have mentioned on a whole previous episode how I am not a debit card girly. I am exclusively a credit card girly, meaning that I put. Everything I can on a credit card to earn my maximum points, my maximum cash back, and also to limit my potential for fraud.

[00:04:53] I just love fucking with some credit cards, so I’m gonna tell you everything. I wish I knew. Everything that I know now and all of the ways I’m able to use credit cards to literally get free. To travel for free to get lounge access, to get just a shit ton of benefits and how you can do it too, and know it’s not just for the, like the straight white guys who like travel all the time for work.

[00:05:16] So first off, why do I need a credit card? Okay, you need a credit card to build credit. I know that sounds like a no duh, but. A credit card used responsibly is one of the easiest ways to start building your credit so that you can have a great credit score. We have talked again on multiple previous episodes.

[00:05:36] We’ll link them down below about how to increase your credit score about what a credit score is. But the easiest way to increase your credit
score in order to give you all of the good things in life is to use a credit card responsibly, responsibly. You are paying your bills on time and in full, literally.

[00:05:52] So we just had a quick aside. Our podcast producer, Kristen, just told me that, uh, you know, she, she had just moved, which is amazing, and they wanted to check her credit in order to get her utilities. And if they didn’t check her credit or if she didn’t have credit, they were gonna charge her $250. So it’s like, You need credit to exist in this world.

[00:06:11] Now, credit’s like a kind of bullshit thing. We’ve talked about this before, but the current system that exists, you need good credit. The way to get good credit is to use credit responsibly. Easiest way to do that, use a credit card. Okay. How do I choose the best credit card? Now the best is subjective to you, right?

[00:06:32] Personal finance is personal. I’ve said it a million times, but if, for example, you sign up for a Southwest Airlines credit card, but you never fly Southwest Airlines, that’s not a good credit card for you, right? If you sign up for a card at a store, But you never go to that store, or you did it as like an impulse in order to get the 15% off, whatever, probably not your best option for a credit card.

[00:07:01] So I need you to look at your financial situation and research cards based on that, right? If you are a student, there’s only so many cards you can qualify for right now because you don’t have a lot of established credits. If you are, uh, a frequent traveler, right, it might be beneficial to get a frequent travel.

[00:07:20] If you are just looking for a good everyday card that checks all the boxes that is secure and that isn’t anything fancy, I would recommend a cashback card. Cashback cards are simply, you’re putting purchases on a credit card. You’re still paying them off in full. Right? But you get points or cash back really every time you make a purchase.

[00:07:43] Some of these cards are like one and a half percent cash back, which doesn’t sound like a lot, but if you go and make a hundred dollars purchase, well okay, you just earned a little bit of money, right? That can either go towards, you know, a gift card or towards actually paying your statement balance. I’ll.

[00:08:00] Multiple times in this episode, but we have all of our recommendations for things like a student card, a cashback card, um, our travel cards all linked in our bio. You can also go to her first hundred k.com/tools to see all the ones we recommend.

[00:08:21] Okay. How many credit cards should I have? A lot of people think, oh my God, I can’t have a bunch of credit cards, or I have this one credit card and I’m scared to open another. Here’s the thing, I have like eight credit cards, but I only used two or three on a daily basis. Now, did I open eight credit cards when I was 18?

[00:08:43] No, I did not. Would that have been a bad decision? Yes, it would’ve been. We are slowly opening up credit cards as our needs start to change. Again. When I was 18 and trying to open my first credit card, I could not qualify for one of the big fancy credit cards that’s like metal, and you hear it go swack when you.

[00:09:01] Put it on a table, which is my credit card now, and is such a flex, and it’s so fun. But when I was 18, I couldn’t qualify for the Amex Platinum or the Chase Sapphire Reserve. I could qualify for a Discover card that looks like a cassette tape. I still have it. I still use it because I want my credit score to stay high.

[00:09:22] One of the factors of credit is how long your credit’s been around for your credit history. So with that credit card that I opened when I was 18, that is not my everyday card anymore, but I opened it and keep it open with a purchase every once in a while. And as I started growing in my financial life, as I started making more money and I started traveling more and my needs started to change, I would upgrade my credit card about once a year, maybe once every other year.

[00:09:49] I remember, okay, I went for my Discover card, then I went to a cashback card cuz I could qualify for that. Then I went to an Alaska Airlines card because I was flying them all the time. Then I got further and further to the point where I could qualify for the bigger card. Now again, we are using our credit cards responsibly, right?

[00:10:08] So I’m not putting anything on any of these cards that I can’t afford. I’m not putting anything on any of these cards that I can’t afford to pay off. So the answer to how many credit cards you should have, It is really as many as you want and can manage, but you don’t need 10. You don’t need 20. You don’t need a bunch of cards to like crazy travel hack.

[00:10:27] For some people, that’s their hobby. They literally have like a portfolio of credit cards. That’s not me. I need you to not open them all at once because what happens when you apply for a credit card is they do what’s called a hard credit check. Anytime you do like a big life event, maybe that is, you know, purchasing a house, purchasing a car.

[00:10:46] Yes, opening a credit card, they are checking your credits. A credit check is not a bad thing, but if you’re getting your credit checked all the time, doing the hard credit check, not just like looking at your credit score on Credit Karma, but if you’re getting a hard credit check like multiple times a year all the time, that can look like you’re irresponsible.

[00:11:09] So don’t just go on a crazy like opening up a credit card frenzy. Be intentional about when and how you open the cards. Remember that new credit cards might lower your score temporarily, so it’s best to not open them before a big purchase, like a a mortgage, right? Getting a mortgage for a house. But I will also say that opening up a new credit card is great for a bigger.

[00:11:34] Small purchase, if that makes sense, like a $2,000 purchase because many credit cards will have a introductory bonus. They will say, Hey, if you spend, let’s say $3,000 during these first three months, you get more points. You get a bigger cashback balance. One of the things you can do to earn that is to strateg.

[00:11:56] Wait to open up your credit card before you know you’re about to buy something. If I’m about to go to Europe, am about to spend $1,500 on a flight, great time to potentially open a credit card, right? And if you’re that person who did just open a credit card or is thinking about opening one and you’re like, how do I get that bonus?

[00:12:14] Think strategically, right? Set aside your big purchases for that time. Pay for dinner and ask people to Venmo. You maybe even buy gift cards that you can use later with your credit card. Again, as long as you can afford it so that you can hit that bonus. All right. We have a lovely question from a guest about breaking up and dealing with shared credit cards.

[00:12:39] So let’s listen to this. First of all, thank you for being you and for providing all of this education to so many of us. It has literally changed my life so very much appreciate that. My question is, If you are in a situation where you are in a relationship, but that relationship is ending and you share credit cards with your soon to be ex-partner, how do you navigate separatin
g those accounts?

[00:13:14] And is it a huge pain in the ass or is it fairly simple? Thank you so much. Have a great day. First of all, congratulations. Also, sorry for breaking up. I never know what to say. I’m either like, yay, good for you, congratulations. Or also, this is sad. Second, it depends on a couple things and literally this is the, I’m actually gonna let you listen to this.

[00:13:38] I am gonna Google it because I’m curious actually how this affects credit. You can hear my little clickety clack. I am literally Googling shared credit cards, removing user, because what you might wanna do is if you want to keep one of you on the card, remove one of you. But I don’t know if you have a balance, if you can do that.

[00:14:03] I don’t think you can. Oh, see, there you go. See, I didn’t know this. Removing a name from the account, unlike a credit card with an authorized user, which is just like you know, one person, me, you generally cannot simply remove one name from a joint credit card. Most issuers will require you to close the account.

[00:14:19] So, and then it says some places will allow you to remove one person, but usually the account cannot be changed until the balance is paid off. Okay. If you pay your bills on time and in full, this is gonna be very easy. You probably just close the card, right? You just close the card, you call it good. If you do have a balance, though, this is where it gets a little spicy, is you have to kind of decide who’s paying what.

[00:14:44] Is one person paying all of it? If it was joint expenses, maybe you’re splitting that in half or you’re splitting that equit. But that’s where things start to get a little spicy, right? So if you don’t have a balance, I would say just close the account. Call it good. Unless, here’s the thing, see, this is, this is why I had to Google it, because if this is your longest line of credit, that could potentially hurt your credit score.

[00:15:08] But, I would say that this is one of those exceptions where I just want you to get out. Like I just want you to be done with it. It’s worth the like temporary credit hit if it means that like, okay, you’re done with this person financially and you don’t have to deal with that anymore. Closing a joint credit card is not gonna remove it from your credit report, right?

[00:15:27] If you. Close the account in good standing, meaning that you don’t have a balance on it, your credit score is not gonna take like that much of a hit. So yeah, my answer, do it clean if you can. If you do have a balance that needs to be a conversation about who is responsible for what, how are we going to pay off this credit card?

[00:15:49] And if you were the person that got saddled with all of this credit card debt, that’s a different story. And I’m really fucking sorry cuz that’s not fair.

[00:16:05] Okay. Couple other questions about credit cards. We talked about this before, but I really wanna highlight it. What does it mean to use a credit card responsibly Paying it off in full and on time. So if you have a thousand dollars that you were putting on a credit card and your thousand dollars payment is due on the 10th of the month, this means that by the 10th of the month, you have sent in a thousand dollars to.

[00:16:30] You can typically set this up on autopilot from your bank account. You can literally say, okay, hello, capital One, or Chase or whomever. I would like you to make sure that I’m paying my credit card off fully, so take the full balance of the bill out of my account every month. This is what I do. If you wait, if you are either late or you pay part of it, you are now in debt or you’re getting charged a late fee really, and or potentially.

[00:17:00] So credit cards are not bad. They’re actually great tools. We talk about this in my book, Financial. Feminist. They’re kind of like knives. Knives can hurt you. They’re also a great tool to cut things like vegetables, right? You need to use them responsibly and smartly. Credit cards are not the devil. Dave Ramsey wants you to believe that they’re not.

[00:17:21] They’re really actually helpful as long as you use them responsibly. We’ve talked about this in previous episodes as well, so I’m gonna give you the like quick hit, and if this still doesn’t make sense to you, go back and listen. You also wanna keep your credit utilization under 30% if possible, meaning you’re utilizing less than 30% of your total credit in order to boost your credit score.

[00:17:43] All right, my favorites. What are some perks that credit cards offer? My favorite part. Let’s talk about. Two most common perks are rewards points and cash back. Rewards points and cash back can be redeemed for discounts on flights, hotels or car rentals, hotel room upgrades, cash back or statement credit, gift cards, tickets to events, physical products, and a lot more.

[00:18:09] I have used points that I have gotten to fly literal. Points that I racked up with airline miles, uh, got me to New Zealand with Christine, like no money. It was like I paid for the fees for the flight that normally from Seattle to New Zealand. We did Seattle to Fiji. Fiji to Sydney. Sydney to New Zealand is usually a like fuck, $2,500 flight.

[00:18:37] Got it for free. We love it. We love to see it. I have literally gotten. Thousands of dollars over the past, let’s say six years in cashback and rewards, so you can redeem your rewards points and cashback for all those options. My other favorite part is all of the other things credit cards can get you. I have a laundry list.

[00:18:58] Here we go first. Some credit cards, and again, we have the ones that offer this linked at her first hundred k.com/tools or linked in our bio. Some credit cards offer airline lounge access. There is no better feeling than waling into a lounge in any airport in the world getting a full gourmet meal plus alcohol for free, and the ability to curl up in a comfy chair.

[00:19:22] I have saved so much money avoiding the overpriced airport food, and during these like long lay. I’ve been able to reserve literally like a napping room or a bathroom with a shower. Christina and I flew in 2019 to London. We flew all night. I woke up at 7:00 AM London time, completely gross. I had been on a plane.

[00:19:41] We checked into the lounge. We got a full English breakfast. We got coffee, and we got an hour reserved in a bathroom with a shower that paid for itself. That felt so good. I got to change outta my gross underwear. I got to wash my hair. It was. Oh, it was so good. You don’t have to be someone like me who’s traveling every other week either.

[00:20:04] Maybe you just go on vacation once or twice a year, but you’re like, I don’t wanna buy the $40 airport chicken sandwich that tastes like shoes. It’s so good, guys. Airport lounge access. Worth. Worth the weight in gold. Another flight perk. TSA precheck precheck is expedited screening throughout your checkpoints.

[00:20:25] You don’t have to take off your belt. You don’t have to take off your shoes. I get through the airport in like two seconds. Clear is also a potential benefit I get with my cards, TSA precheck for free, which is $75 and clear for free, which is $189. I have not waited in an airport line longer than 10 minutes.

[00:20:44] I literally cannot tell you the last time. Global entry is also a potential perk for free. It is basically like. You get access into countries or really back into your home country for way less time. You avoid the lions. This is where this came in handy. I’m realizing the majority of this episode is just gonna be telling you stories about how amazing these things are, and I’m not mad about it.

[00:21:10] I was coming back from Vancouver, Canada back into the United States. I went for my birthday last year. We roll up this line to get our car back into the states was three hours long at least. You know what wasn’t three hours long, a full separate line for global entry. We literally just drove up. We were through that line in 30.

[00:21:31] Incredible. Paid for itself. Okay. Seed upgrades, potential perk, priority boarding, potential perk, food and beverage credits, flight delay protection. This one is so crucial. I didn’t realize how hyped I was gonna get this episode, but truly, if you get delayed, if your flight gets canceled, if you have to stay overnight in a hotel, your credit card will pay for it.

[00:21:55] Your credit card will pay for it, so you don’t have to worry about. Also, sometimes they’ll pay for trip insurance, right? That little thing at the end when you’re booking a flight and it’s like, do you wanna pay for travel insurance? And you’re like, no, I’m not paying extra money. Sometimes your credit card will have that for you.

[00:22:11] Sometimes they’ll do baggage delay insurance. Our TikTok manager, Alina, she traveled to Australia. Two of her bags were lost for a week. Every single thing she needed, she put on the credit card and the credit card comped her. Good. There’s also lost luggage reimbursement. If your just luggage never shows up, they will reimburse you for it.

[00:22:31] Okay. Hotel perks. This is also available with some credit cards. My credit cards that I love also give me early check-in or late checkout. I have some cards that’ll let me check out at 4:00 PM if I got a late flight. Nothing better than sleeping in bed till 4:00 PM. Sometimes they’ll do food and beverage credits, or they’ll do check-in gifts.

[00:22:51] I checked into a hotel two years ago to go to Disneyland. We got unlimited bottled water and some snacks. Doesn’t sound like a lot, but it was. It was lovely. Didn’t have to worry about it. Sometimes there’s spa and retail credit. There’s room upgrades. Christina and I last year, were in New Orleans for my birthday, or this was two years ago.

[00:23:10] Credit cards got us a free upgrade to an executive suite. This hotel room had two bathrooms in the room. There were two bathrooms. Never experienced that before. And an amazing view of the city. Free parking, upgraded wifi concierge services.

[00:23:32] Okay. Couple of the other things that are really amazing, car rental insurance. For most credit cards you get car rental insurance, meaning again that you are covered as long as you put the cost of that car rental on that credit card. They often will get you at like Hertz or budget. They’ll go, oh, do you want your own insurance?

[00:23:51] And if you don’t, you’re liable. You don’t have to pay them cuz it’s already included as a benefit. Priority access to events. There’s credit for streaming services. I get peacock for free. I, I need to watch the office constantly. It’s great. Uh, no foreign transaction fees is huge, meaning that if you go abroad and you use your credit card and you’re not charged extra for using it abroad.

[00:24:16] And one of the things you don’t realize until you need it is some cards will also cover emergency medical or dental deposits or costs when you’re travel. If you have to go to urgent care, if something happens and you. Medical assistance, they will comp that for you. Again, depends on the card. A lot of these, like more robust benefits are available for these like higher ticket cards.

[00:24:39] Right? A lot of credit cards have an annual fee. The annual fee is sometimes like 50 bucks. Sometimes for something like the Amex Platinum that I have, it is $700. Now is that a lot? But does it pay for itself? A hundred percent, yes. When you consider, okay, TSA precheck $75, I get a $250 travel credit. Every year I get airport lounge access and I’m not paying for food.

[00:25:03] Right. It very easily pays for itself. Okay. This is the like T L D R to credit cards. Obviously I’m a huge proponent of signing up for a credit card, starting to build credit and getting free shit. There’s very few moments in life where you get to have free shit that makes you feel fancy. So start building credits.

[00:25:26] If you don’t have a credit card, if you’re ready to upgrade your credit card, we have our recommendations linked. Get on it. I truly cannot say enough good things, but please make sure you’re using them responsibly. You’re paying them off on time and in full. Don’t let the knife cut you. Use it to make a yummy veggie stir fry.

[00:25:44] As always, Financial Feminist, we appreciate you being here. We appreciate your support. If you like this episode about credit cards, please feel free to share it. And if you want to see more episodes where we’re answering your frequently asked questions, send us a voicemail. We’ll talk to you soon. Thanks for being here.

[00:26:01] Thank you for listening to Financial Feminist a her first hundred K podcast. Financial Feminist is hosted by me, Tori Dunlap, produced by Kristen Fields Marketing and Administration by Karina Patel, Cherise Wade, Alina Heller, Paulina Isaac, Sophia Cohen, Valerie Esco, Jack Coing. Kail Duaz, Elizabeth McCumber, Beth Bowen and Amanda Lephew.

[00:26:23] Researched by Arielle Johnson, audio Engineering by Austin Fields. Promotional graphics by Mary Stratton, photography by Sarah Wolfe. And theme music by Jonah Cohen. Sound a huge thanks to the entire her first a hundred K team and community for supporting the show. For more information about Financial Feminist, her first hundred K are guests and episode show notes.

[00:26:42] Visit Financial Feminist podcast.com or follow us on Instagram at Financial Feminist podcast.

Tori Dunlap

Tori Dunlap is an internationally-recognized money and career expert. After saving $100,000 at age 25, Tori quit her corporate job in marketing and founded Her First $100K to fight financial inequality by giving women actionable resources to better their money. She has helped over one million women negotiate salary, pay off debt, build savings, and invest.

Tori’s work has been featured on Good Morning America, the New York Times, BBC, TIME, PEOPLE, CNN, New York Magazine, Forbes, CNBC, BuzzFeed, and more.

With a dedicated following of almost 250,000 on Instagram and more than 1.6 million on TikTok —and multiple instances of her story going viral—Tori’s unique take on financial advice has made her the go-to voice for ambitious millennial women. CNBC called Tori “the voice of financial confidence for women.”

An honors graduate of the University of Portland, Tori currently lives in Seattle, where she enjoys eating fried chicken, going to barre classes, and attempting to naturally work John Mulaney bits into conversation.

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