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Which Credit Card Debt Should You Pay Off First?

If you have a number of credit cards with balances on them, you might feel overwhelmed by having a large number of monthly payments or a total balance that is higher than you are comfortable with. If you have finally decided that it is time to take action and pay off some of this debt, there are several different ways to approach the task.

While each will get you ahead financially, it’s important to understand that they offer different advantages. Let’s discuss some of the common ways that you can pay off your credit cards and get ahead.

Determining Where to Start

There are several ways to approach the problem. Different strategies will appeal to different people. Think about the debt that you have, and what you think will help you most.

For some, paying less interest is important. Other people find that minimizing the number of monthly payments is important. For others still, freeing up liquid cash each month matters most. Some people might choose to use one of the best balance transfer credit cards to help them focus on one payment.

There is no “one size fits all” type of plan. Consider which part of your credit card debt bothers you most and then consider the options below.

Highest Interest Rates First

Many people aim to pay off the credit card with the highest interest rate first because this means that they will be paying lower interest in the long run. If the idea of paying a lot of interest is the part about your debt that bothers you most, this is a good place to start. Often store cards have higher interest rates, and many people will opt to begin by paying these off.

Importantly, you should review the interest rates for all of your cards. Ensure that you are not paying a penalty APR for making a late payment at some point. If you are paying a credit card balance that has a high-interest rate, such as over 22%, you probably want to focus on getting rid of this kind of debt first.

Highest Balance First

Some people become worried when they have a credit card with a large balance or one that is nearing the credit limit. Focusing on putting some extra cash toward payments on these cards can help minimize the stress of having credit card debt. When you put extra money toward this card each month, you will be able to watch the balance drop, getting you closer to financial freedom.

It can be very motivating to watch that high balance get a little lower each month. You may be inspired to devote even more of your extra cash to this project, therefore paying it off more quickly.

Pay Off Smallest Balances First

For some, paying off the smallest balances first can help to eliminate the number of monthly payments that must be made. The fewer the payments that need to be sent out, the less likely it is that you might accidentally forget or miss one and end up with a late payment penalty fee. Plus, as you pay off these smaller-balance cards, you will slowly have more money to make payments on the larger-balance credit cards. Close the credit cards that you don’t plan to use—unless you have had them for a long time and have a great credit history with them.

Final Thoughts

Understanding your credit is important. Keeping track of your credit cards and balances and making all of your payments on time is critical to your financial health. Each of these strategies can help you get closer to being debt free. Plus, each has their advantages.

Make a plan of attack by making a list of all of your debts. Go into detail listing monthly payment options, total balance, interest rate, etc. Then make a plan and stick to it. You will be delighted when you start to see progress!

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The Sam’s Club MasterCard vs. Other Cash Back Cards

Everyone loves a cash back card, which is why so many banks and stores offer them to customers. It used to be just the big banks that gave cash back rewards based on spending. Now it is common for stores to get in on this market and get more customer loyalty in the quest for cash being returned to them.

Some stores have even begun to offer cards that come in MasterCard or Visa versions that they can be used for other purchases, like gas, dining, groceries, travel, and other big categories. The Sam’s Club MasterCard is one of these cards. They are offering a nice tiered cash back program to cardholders.

If you are a frequent shopper at Sam’s Club warehouse stores, this might be a good choice for you. Let’s take a look at the benefits that they are offering to customers.

New Sam’s Club MasterCard

Highlighted Cash Back Features

The Sam’s Club MasterCard offers simple yet substantial cash back rewards for their customers. First, you will earn 5% cash back for all spending at gas stations, up to $6,000 per year. After you spend the first $6,000, you will continue to earn 1% cash back on gas station purchases. Here’s one catch—you will earn 5% cash back at Sam’s Club gas stations and other major gas retailers, but there are no cash back rewards for spending at other warehouse store gas stations.

You can earn 3% cash back on all dining purchases and any travel purchases that you make, with no spending cap. Earn 1% cash back on all other purchases using the Sam’s Club MasterCard.

With the Sam’s Club MasterCard, you can earn up to $5,000 cash back per year. The cash back rewards are paid to you in the form of a check, delivered to you once per year. The only place that you can cash the check is at a Sam’s Club store (but you don’t have to spend the entire reward there).

Great Security Options

With so many credit card breaches in the news lately, people are paying more attention to getting credit cards with higher level security features. The Sam’s Club MasterCard is chip-enabled, which gives you a better layer of security. Plus, they offer quick and simple identity theft solutions through their customer service center.

Sam’s Club MasterCard is the first major retail card to offer this level of technology. Since many of the credit card breaches have come from major retailers, this is something that may make customers more comfortable and secure when using the credit card. Also, extended warranty coverage is available, so you can be more confident in protecting your purchases.

No Annual Fee

The Sam’s Club MasterCard does not have an annual fee, but you do have to be a Sam’s Club member to apply. Membership to Sam’s Club is $45 per year.

More Benefits for Sam’s Plus Members

For those cardholders who are also members of the Sam’s Plus program, you can receive several additional benefits. These include early morning admission to the store, discounts on pharmacy and optical services, and exclusive offers within the store. Sam’s Plus members will earn an additional $10 every time they spend $500 in the store on qualifying purchases and earn up to $500 cash back annually. These rewards can be combined with the other cash back rewards to boost your annual return, or used separately throughout the year.

The Nitty Gritty

Again, the Sam’s Club MasterCard has no annual fee, but you must be a member of Sam’s Club to apply ($45 yearly membership fee). The APR is 14.99% or 22.90%, depending on your credit history. If you make a single purchase of $50 or more on the first day you use the card, you will get a $20 statement credit within the next two billing cycles. Foreign transaction fees are 3%.

Any Downsides?

Although the Sam’s Club MasterCard offers some great cash back options, you will only receive that cash back reward once per year. If you are the kind of person who likes to get one lump sum, this might be great for you, but the redemption options are not very flexible otherwise. Remember, you can only cash this check at Sam’s Club. If you regularly shop at the store, this may be convenient.

You must be a Sam’s Club member to cash the check, so don’t consider closing this account if you have any cash back rewards due to you. There is a small sign up bonus of $20 if you spend $50 on your first purchase. Other cards offer greater cash back rewards for sign up bonuses.

Other Options

While the Sam’s Club MasterCard can compete on some levels, especially with Sam’s Club devotees, there are other great cards out there that offer significant rewards for those who spend a lot of money on gas, dining, and travel. Other cards offer much more convenient redemption options when it comes to getting the cash back.

Barclaycard Arrival Plus

The Barclaycard Arrival Plus is a great option for those travelers who like to earn big cash back rewards on every purchase, and have flexible redemption options available to them. With the Barclaycard Arrival Plus, you will earn 2 points for every dollar spent, on all purchases. You will earn 40,000 points as a sign-up bonus when you spend $3,000 within the first three months.

Redeem your miles for travel credits or statement credits, at any time. Earn an additional 10% bonus miles when you redeem your miles for travel rewards. There is an $89 annual fee, but this is waived for the first year. Barclaycard Arrival Plus offers great security, with EMV-chip technology.

There is also a 0% introductory APR on all purchases made during the first 12 months. Frequent travelers may find this option very appealing because of the high earning power and flexible redemption opportunities.

Discover it

For those shoppers who like to earn great cash back rewards and have very flexible redemption options, the Discover it has some terrific perks. Earn 1% cash back on all purchases, in all categories. Earn 5% cash back on rotating bonus categories, which change quarterly and are generally the most popular shopping options. Currently, Discover it is offering 5% cash back on online shopping and department store purchases for this quarter.

There is no annual fee for the Discover it card, so you have nothing to lose. Redeem your cash back rewards at any time, either earning a check, using the cash at the online shopping portal, getting gift cards, or getting statement credits.

Final Thoughts

For those who really love shopping at Sam’s Club and spend most of their money at gas stations, the Sam’s Club MasterCard is a good option. But, if you want a little more flexibility in terms of cash back earnings and redemption options, you might want to consider either the Barclaycard Arrival Plus or the Discover it as alternatives.

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Will Canceling My Credit Card Hurt My Credit Score?

We’ve all heard the importance of paying close attention to our credit scores. Many of the credit card companies are beginning to catch on to the importance of having consumers keep it in control, and helping them track it—whether on a monthly statement, like Discover, or through the online account, like Chase and US Bank. But the question remains: will canceling my credit card hurt my credit score?

Once you start to pay attention to your credit score and understand just how it is calculated, you should be doing everything you can to keep it in a good range, or make it better. Canceling a credit card is one thing that many people do without realizing that it can have a damaging effect on your credit score.

Here are the answers to some common questions about canceling credit cards and how it might affect your credit score:

Will closing a card I don’t use hurt my credit score?

In general, it won’t hurt you to keep a credit card open. It will have more of an effect on your credit score if you close it, especially when you have had a card for a long time. The length of time that you have had a card is a factor in determining your credit score. That said, you definitely don’t want to close your oldest cards, even when you no longer use them.

Of course, if they have high annual fees, you may want to weigh this decision heavily. Consider using the card if they offer great perks, downgrading to a no-annual-fee version, or making a request to the credit company to waive the fee for a year. They just might consider this, depending on your relationship with them.

Is there such a thing as too much credit?

Some people are under the assumption that you can have too much available credit. This is not really the case. You can open too many cards in too short of a time period, which can hurt your score. You can ring up too many purchases too quickly, which raises your debt level. This can hurt your credit score. But, for the most part, you can’t have too many credit cards that are paid in full.

If you do choose to close a credit card, the credit history will remain on your credit report. If you were a customer in good standing for 10 years, this will show up on your credit report, and it will help your credit score. If you do take a hit to your credit score for closing an older, unused credit card, the ding should be temporary if your credit is solid.

Are there reasons to close a credit card when trying to raise my credit score?

If you have a good history with a credit card, and there is not a huge annual fee, then, no, there is not really any reason to close a credit card. It won’t help your credit score to close it. Keep it, especially if you have had it for a long time, even if you don’t use it.

What happens if the credit issuer closes the account?

While closing a credit card yourself is usually better, a closed account is a closed account. It will show up as “closed by consumer” or “closed by creditor”. Unfortunately, some reading your credit report may assume you had problems.

The best thing to do is try to avoid having creditors close your account. If it does happen though, don’t worry. It doesn’t really make a difference in the long run. You will take a hit to your credit score either way, and you can get your card closed due to inactivity. Each company has different policies so checking with their terms and conditions may be in your best interest.

Should I close my store credit cards?

Store credit cards are the ones most commonly closed by creditors when they are inactive. Store credit cards do have an impact on your credit utilization. Let’s say you owe $500 to a store and you have a $600 credit limit. This is a high credit utilization for this card.

Make sure that your other cards have lower rates of utilization. It would be even better if you can pay something off. Closing store credit cards does have less of an impact on your credit score than closing major bank credit cards. Your credit report will focus on the bigger picture—mortgages, loans, major credit cards, revolving credit lines, etc. when calculating your score.

While it’s better to keep all your big cards and close the store cards, it’s not the end of the world if you can’t. One thing to keep in mind about store cards is that they may be your oldest credit card since they are often easier for people to get. If you have had a store credit card in good standing for 15 or 20 years, then there is really no reason to close it and more good reasons to keep it open.

Final Thoughts

Closing credit cards can have a temporary effect of lowering your credit score. As long as you are not closing your oldest cards and are keeping all of your cards in good standing, there is no reason to close any. Keep track of what you have. Make sure you are not paying any unnecessary annual fees. Understand how your credit score is calculated. You will likely find that you won’t need to close any cards and can keep your credit shining!

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How to Close Credit Cards Without Hurting Your Credit Score

For some, just getting a credit card in the first place is a huge accomplishment. For others, they seem to accumulate tons of cards, many of which they don’t need or don’t even use. How do you decide which ones to cancel? And how can you do it without affecting your credit score in a negative way?

Take Inventory

The first step in deciding which cards to keep is literally setting them all out in front of you to see what you are dealing with. Reviewing your credit report may also be important, in case you actually don’t have all the cards handy. Ask yourself the following questions about each card, and divide them into groups based on your responses:

  1. How often do I use this card?
  2. How long have I had this card?
  3. How much do I pay (fees, interest, etc.) for this card?
  4. What rewards and benefits do I get with this card?

Time to Purge

As you review how often you use each card, consider closing those that are pretty dormant. Unless of course you have had the card for a very long time with a good history. It’s okay to keep a card you don’t use often if you have had it for a long time—this is good for your credit score.

For the most part, you should consider closing your store credit cards. These tend to offer the least benefits to you, and you are better off with a major credit card that has great rewards and you can use anywhere, as opposed to store credit cards that offer you coupons for in-store purchases. This will help you streamline your credit card inventory and leave you with a couple of cards that you will really benefit from using.

Take it Slow

It’s best to not close a whole bunch of cards at once, as this can cause your credit score to dip a bit. You will probably recover quickly, if you have good credit; however, if you do it in stages the effects on your credit score will be minimized. This is especially important if you are planning on applying for any loans (auto loans, mortgage, etc.) because you want your credit score to be as high as possible for the best rates and terms.

How Do I Do It?

Closing credit cards is not difficult. In most cases, you can call the customer service department and request that the account be closed. Be prepared to meet a little resistance, because they will probably try to talk you into keeping your account—they don’t want to lose customers. But, if you are firm and polite, it is not going to be a problem. In some cases, they want a written request, which means sending a quick letter indicating that you want to close the account.

When you close a credit card account, it can take a few weeks (or longer) to show up on your credit report, so be patient. But, do be sure to check your credit report a few months after you finish your purge, to make sure that everything is accurate and only the accounts that you want are still reflected as open and active on your credit report.


It’s so important to stay on top of your credit and be responsible. Nobody needs dozens of credit cards cluttering up their wallet—or their credit report. Pick and choose wisely, and keep the cards that offer you and your credit score the most benefits.

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These Cash Back Cards are Better Than Store Credit Cards

Most of the time, we would try to steer you away from store credit cards, because while they may get you some discounts on your purchases, they often come with very high APRs and their introductory perks can end quickly, leaving you with nothing but a piece of plastic that you can use in only one place.

Fortunately, we do have some better suggestions for you! Here are a few ways that you can save more, get better cash rewards and points, and spend money wherever you want—without having to be especially loyal to any one store. Shop where you get the best deals!


Discover it

Consistently rated among the top credit cards when it comes to annual fee and rewards benefits, the Discover it® offers 1% cash back on all purchases, with 5% cash back on quarterly rotating categories. Because the categories are usually ones that are quite popular (e.g., groceries, gas, dining, shopping categories), cardholders can accumulate great rewards all year long.

When you add in the ShopDiscover online portal, the deals are outstanding and you really get your money’s worth out of any purchase. Forget about using a store credit card for financing, use the Discover it, get cash back and, if you make your purchases within the first 14 months, pay no interest whatsoever. This is a better financing plan than most store credit cards can offer.

Apply Now: Discover it®


Chase Freedom

Another great cash back credit card that beats most store cards is the Chase Freedom. Also with no annual fee, it offers 1% cash back on all purchases, with rotating categories earning 5% cash back, up to $1500 in spending per quarter. For example, the current quarterly categories are,, and select department stores.

Also, enjoy getting great bargains at the Chase Ultimate Rewards online shopping portal, where you can often redeem your points for terrific deals at greater than face value! Add in the bonus of getting $100 cash back after spending $500 in the first three months, and this card definitely beats any store card, hands down!


American Express Blue Cash 

This is a pretty special card with tons of great perks, and amazing ways to earn lots of points. For all department store spending, you earn 2% cash back. This beats most department store credit cards, right off the bat. Add in the fact that you can earn 3% on groceries and 2% on gas, neither of which are options for most store credit cards, and the contest is over, in our minds.

Sure, there is a $6,000 cap on grocery spending, but there is no cap on the gas allowance. If you really want to see how generous the rewards are, then pay attention when you get a $50 statement credit after spending $1000 in the first three months. Get a free subscription for one year to Amazon Prime ($79-99 value) when you meet that spending minimum.

All of those benefits are available for no annual fee. If you want even more, you can sign up for the American Express Blue Cash Preferred card, and pay a $75 annual fee. In exchange for this fee, you will earn even more rewards (such as 6% on groceries, 3% at gas stations and department stores), and earn a sign up bonus of $150 after spending $1000 in the first three months. There is no cap to the rewards that you can earn, and it’s pretty likely that you will be able to make up for the annual fee easily.


Are There Any Decent Store Credit Cards?

Most of us have, or have had at some time in the past, store credit cards to our favorite retailers. Not all of them are terrible! You can get some great coupons and special deals, but, we still think that a regular cash back card is going to do better over time.

Some of the best ones may be the Gap credit card, which offers 5% back on in-store purchases; American Eagle Visa, which offers 4% cash back and a 20% birthday coupon; Kohl’s Charge Card, which offers 20% cash back—this is one of the better deals if you shop at this store; and Target, which offers 5% cash back on in-store purchases.

Generally, these store credit cards offer the best deals for in-store shopping. Some still love this way of doing business, but if you are more of an online shopper, or prefer to shop around for great deals from different retailers, you will not see huge benefits from any store credit cards.



In conclusion, it should seem clear that we definitely lean toward using cash back rewards cards from credit card companies like Discover, Chase and American Express, and would encourage you to explore your options beyond the immediate checkout lure of signing up for a store credit card. You will thank yourself in the long run, when you are enjoying the great cash back rewards that you can use any way you wish, not just as an in-store coupon.

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Target Redcard Review

The Target REDcard is a special kind of store credit card, one that actually functions more like a debit card than a credit card. When you use it to pay for a purchase, it will take the funds out of the checking account that is associated with the account.

This means you will never carry a balance on this card, which is a convenient feature. There are some other great features, let’s dig in and take a look at this card and you can decide whether or not you like it!


The Benefits

Easy to Apply

Applying for the Target REDcard is simple, and you can do it right at the register in Target while you are making your purchases, or you can apply through the mail. You will need to provide a voided check when you apply. There is no credit check required to apply for a Target REDcard, making it an accessible discount card for anyone who wants to have it. All you need is a checking account.

Great Discounts!

Get a 5% discount on all purchases made using the Target REDcard debit card, both in the stores and online. There are certain exceptions, including prescriptions and gift cards, but this is a significant discount. The discount comes in the form of money off of your entire purchase, not points that you can redeem later. Many like the instant discount feature for the Target REDcard.

Free Shipping When You Order Online

Whenever you shop at using your Target REDcard, you can enjoy free shipping on all of your purchases, with no minimum purchase required.

No Annual Fee

There is no annual fee for the Target REDcard, and no application fees. Because it is completely free to use, it can be a painless addition to your financial portfolio, and one that can get you great discounts if you love shopping at Target.

Convenience of Direct Debit 

You won’t receive a monthly statement or bill from Target REDcard, because you will pay for all of your purchases in full at the time of purchase, since the money is automatically debited from your checking account. This means you will never incur any debt by using the Target REDcard.

Donate to Education

Target is committed to making charitable contributions, and makes a donation to education that is the equivalent of 1% of all purchases made with the Target REDcard. The donation will be made to the school of your choice, so you have a say in where that money goes.

Easy Return Policy

If you prefer to shop online, you will enjoy the free shipping, but one of the great perks is that you can make the returns in any store. No worries about return shipping costs or packing up your returns. Just head to the store for your refund or to make your exchange.

Save on Prescription Copays

When you fill five or more prescriptions at the Target pharmacy, you will get an extra 5% discount coupon that you can use on any single day at any Target location, and the 5% discount will be in addition to your normal 5% discount for using the REDcard.



Although this card is great for people who love shopping at Target, it is not terribly useful for other shopping purposes (actually not useful at all). It does not yet work with Target Mobile, but this may change in the future as more people access their shopping through the mobile app.

Also, the Target REDcard does not add any debt to you, but will also not affect your credit or help you build credit at all. So, if you need to build credit, you might want to consider one of the other cards available or a secured credit card.



The Target REDcard does offer some great discounts and free shipping options for those who love shopping at Target, but has little else to offer. If you shop at other places, and have a credit score that would qualify you for a regular unsecured credit card, you might want to consider the Discover it® card or the Chase Freedom, both of which provide great cash back or travel rewards and give you credit for all of your purchases. Plus, they offer rotating categories of 5% earnings for points, and sometimes this will even include department stores like Target!