What is a Citi Premier Card?

By now, most of us are familiar with credit cards at least in some capacity. In fact, some would venture to say that they are an integral part of adulthood – at least when it comes to our financial security. Why is that, though? Put simply, they are a valuable tool for building credit scores. Now, if you did not know, these scores are figures that the major credit bureaus keep track of and calculate, and most (if not all) lenders use them as a gauge of how trustworthy a borrower is. You can find some more information on it here, but that’s the main idea.

Now, this does raise an important question, though – how can a credit card work to help us build our credit scores? First, you have to understand how these scores operate in the first place. So, if that is something you would like to know, as well as how you can pick a card that will suit you, then be sure to keep reading!

The Basics of Credit Scores

Everyone starts off with a neutral credit score. For most people, this starts to come into play either in their teenage years or early twenties, although it could certainly be sooner or later than that. Really, it is up to each of us as individuals to decide when we want to start our financial journey in this sense.

With all of that said, it is critical that we keep in mind that the better credit we have, the more opportunities we will have available to us in the future. That is why building it up sooner rather than later is so important. For instance, having no credit history (or poor history) will make purchasing a car or a home much more difficult.

How do we build them up, though? This can be a bit of a challenge since being approved for credit agreements without much history is not always the easiest thing. However, if you opt for a Citi Premier® Card or one similar to it, you might end up finding an opportunity there. It is always worth at least submitting an application to try to qualify!

How do Credit Cards Work?

Now that you have got a better understanding of credit and how it relates to this, we can shift gears to our main topic of today. Credit cards function as a sort of “revolving door.” They are a type of loan, which can be EASY to forget sometimes.

One of the biggest mistakes that borrowers can make is to consider the balance they have available as “free” money. Remember that it is in fact quite the opposite of that. Each purchase made on one of these cards will have interest charged if the balance is not paid off at the end of the given pay period.

This is often what makes people consider them to be a “trap.” However, there are plenty of cards that are actually quite helpful to have around. That is as long as they are used responsibly. You can find an analysis of “responsible” credit card usage in this article, but it’s pretty simple.

Building Credit

You might be wondering how people can build their scores by using credit cards. Much of it comes down to the fact that scores are calculated based on how well a given borrower is able to make their repayments on time (as well as bills in general). The idea here, then, is to put small purchases on the credit card. Then, pay them off before interest ends up getting charged.

By doing this, you can have a relatively risk-free method of raising your score. Just bear in mind that it does take some self-discipline in terms of not overspending. So long as we are careful, it can be quite beneficial!

Rewards

The other part of this that we would like to cover is that many credit cards have rewards attached for using them. However, it will depend on the lender, of course. There are so many out there to explore that you are bound to find something that suits your fancy. What is nice is that there are all sorts of different rewards programs available.

One that many of us have heard of is the frequent flyer program. You can earn “miles” by using your credit card to purchase plane tickets.  This is not really appealing to everyone, though, so what else is there?

Cash-back programs are another one. They are quite nice because they give us as cardholders some benefits for spending. Obviously, they should still be used judiciously. However, getting some cents back on every dollar is nothing to sneer at!

If you cannot find rewards that interest you, consider asking your current lender if they have any options. You can also check out some of the sources we have provided!