Free Credit Cards – Are They A Myth?

July 26th, 2010

Let’s face it: there’s no such thing as free credit cards as they will always cost you something, but there are ways to make sure they cost you as little as possible.

One of the best ways to minimise the cost of a credit card is to combine strategies. If you choose a no annual fee card with a policy of always paying off your monthly card balance, then you’ll be as close to dreams of free credit cards as you can get.

Free Money!

In addition, most cards will give you an interest-free period on your purchases, usually up to 55 days, which is as close to free money as you’ll get.

But always remember – to gain maximum advantage of these features, you must pay off the credit card balance in full or your free credit card turns into, not a pumpkin, but a much more expensive credit card.

Increasingly, free credit cards have become a very useful tool for small business operators who often find it difficult to get cost-effective credit from the big operators. In the days when credit card interest rates were up to or beyond 20%, borrowing on the plastic was an unrealistic proposition.

When Credit Cards Beat The Bank

But if the small business operator can overcome a temporary cash flow problem by borrowing on the low interest, say 0% to 3%, credit card with no annual fee, then that’s a much better deal than a 7% – 9% or more loan from the bank.

The usual caveat applies. Pay the debt off during the low interest period or face the crippling consequences.

Finding Free Credit Cards

Having decided free credit cards are the ones for you, how do you find them? Today, it’s just so easy. Comparison charts now exist on the Internet that allow you to compare and cost all the different kinds of credit cards that are available.

You can just look at the no annual fee cards and then compare what added extras they have, whether they’re attractive to you, and will they cost you more.

Having made your choice, the Internet also offers you a simple process for applying.

You simply click on the relevant link to the credit card issuer, follow the instructions and your application is swiftly underway.

These days, provided you take sensible precautions, there are no privacy or security fears and you don’t even have to make the effort to go into a branch.

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	Interest Rate (p.a.)	Balance Transfer Rate (p.a.)	Annual fee	Cash Advance Rate (p.a.)
HSBC Credit Card	17.99%	0% for 8 months with 2% handling fee	$0	21.99%
Virgin No Annual Fee Credit Card	18.99%	2.9% for 6 months	$0	20.99%
Bankwest Zero MasterCard	0% for 6 months (reverts to 17.99% )	4.99% for 9 months	$0	18.99%