Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
When used responsibly, credit cards offer a great way for you to earn rewards, get cash back, and improve your finances. But with so many credit card options from which to choose, deciding on the best card for you can be a challenge. Should you opt for a regular rewards credit card with no annual fee or a premium credit card with an annual fee that could be as much as $95?
Check out the perks offered by the premium card
Some airline-branded cards offer a free ticket once a year or the opportunity to purchase a companion ticket at a reduced rate. For example, if you can purchase a companion ticket for $99 instead of paying another $350 for your partner to fly, it would make the card worth the $95 annual fee. You can look at it as paying $194 (the $99 ticket plus the $95 annual fee) for your partner’s ticket, which would save you $156 overall.
Other perks, such as access to an airline’s lounge, free checked bags, free hotel stays, or discounts on concert tickets, can also be worth the annual fee. As long as you use those perks regularly, you will come out ahead, even after paying the fee. To optimize your perks, plan ahead, make your purchases, and then pay off the balance each month.
Find out if the premium card offers extra cash back
Some premium credit cards have set tiers for cash back earnings. For example, a card may offer triple the points on grocery purchases and double the points on gas purchases. If you use your premium credit card each day for regular grocery and gas purchases, you can quickly exceed the annual fee in the amount of cash back you receive.
You do have to pay off the balance each month if you expect to reap the full benefits of a premium card. Once you start paying interest on your balance, a premium card is certainly not worth it.
(Read more: Six Things to Know About Credit Card Rewards)
Know when to avoid a premium credit card
Using a premium credit card requires planning. Many of these credit cards are connected with travel, so if you don’t travel a great deal, a premium card might not be the best choice. Realize that receiving a large number of points that can be redeemed once for a free ticket—usually as your signing bonus—isn’t usually enough to justify the yearly fee for a premium credit card. While you may have come out ahead for the first year, you need to think about the next year, when that annual fee is due again.
You also may not want to get a premium credit card if you currently carry balances. No amount of bonuses and premium perks can make up for a high rate of interest on a carried balance. Instead, consider a 0 percent APR credit card so that you can transfer balances and pay them off.
Once you have your feet under you, you can decide whether or not a premium credit card is worth the annual fee.
Miranda Marquit is a freelance writer and professional blogger specializing in personal finance, family finance and business topics. She writes for several online and offline publications. Miranda is the author of Confessions of a Professional Blogger: How I Make Money as an Online Writer and the writer behind PlantingMoneySeeds.com.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.