Shopping Around for a Credit Card

Did you “shop” for the Visa, MasterCard or AmEx in your wallet? Chances are, you have it only because you already do business with the same bank or because it came pre-approved with a big line of credit. 

Until a few years ago, there was little reason to shop because all cards were about the same, but that’s all changed. One card can cost hundreds of dollars more a year to use than another. Here are nine important features you should compare before you sign up for any credit card:

9 things to look out for in a new credit card

1. Annual percentage rate

For most people the interest rate is the most important feature, because most of us pay finance charges. While many cards charge up to 27% interest, some Visas and MasterCards have rates around 11%-15%. 

Even if you never plan to pay interest you should look for low rate cards because few people ever plan to carry a balance; it just sneaks up on them.

2. Grace period

The average number of days you have, from the day your billing period ends, to pay it in full to avoid finance charges. Most cards have either a 25 day grace period or none at all. A few cards will give an extra five days, the five days between the day your bill is due and the start of the next billing period. 

There is never a grace period on any card if you didn’t pay your balance in full in the previous month or on cash advances.

  • TIP: Maintaining your grace period is very important because a 25 day grace period can actually turn out to be 50 days or more. For example, if you make a purchase on the fifth day of your billing period, you get both the 25 days till your billing period ends plus another 25 days until your bill is due.

3. Annual fee

A very low annual fee is most important to people who seldom carry a balance. If you carry a high balance, you’re probably better off getting the lowest possible rate even if it means paying a somewhat higher annual fee. Avoid cards that have no annual fee but charge a transaction fee on every purchase.

4. When does interest start?

Some cards add new purchase amounts to your average daily balance from the date of purchase; others start from the day the purchase is posted, which can be days or weeks later. 

This is important because your average daily balance determines your finance charges for the month. There are other differences in the way finance charges are calculated, but you’d need a computer to figure them out.

5. Cash advance transaction fee

This is a fee some cards charge with each cash advance in addition to the finance charge. While fees of 2%-5% are not unusual, many cards don’t charge a fee.

  • TIP: This feature is important for people who are trapped into staying with a high rate card because they can’t pay off the balance. Cash advances can be used to transfer an existing balance from a high rate card to a low rate card.

6. 7. & 8. Late payment, over credit limit & bounced check fees

Some cards charge these fees immediately; others give up to 30 days or longer to correct a problem before they’ll charge you.

9. Fixed or variable interest rate

If a card has a variable rate, what index (T-Bills, Prime Rate, etc.) determines the rate? Some have formulas that cause the rate to move often; others are relatively stable despite a variable rate. 

Explore how often the rate has changed over the last couple years. If a card has a very low rate, small changes should not be a major concern.

  • TIP: Don’t choose a fixed rate card simply for protection from rate changes; any fixed rate card can change with just 30 days’ notice. The only thing a fixed rate card protects you from is small changes in rates, both up and down.
  • TIP: The most economical use of credit cards for most people, next to never carrying a balance, is a combination of two cards. Use one for smaller purchases and pay the balance in full every month. Grace period and low annual fee are most important, but get a relatively low rate just to be safe. Use the second card for larger purchases that you plan to pay off over time. A very low rate is most important, low annual fee is less important, and grace period is not a big factor because there is never a grace period on any card when you carry a balance. Shop carefully for your next card and put the money you save into your own pocket.

Copyright 1989, Bob Cassinelli

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Frequently asked questions

You can find out the value of old credit cards by checking how much similar cards sell for. There are several ways to do this.

The simplest way to determine the value of old credit cards is to ask an experienced collector. If you submit an inquiry via our contact form, we can connect you with an expert who can assist you and point out if there is anything rare or unusual in your collection.

Alternatively, you can become a member of the American Credit Card Collectors Society. Membership in our credit card collecting club provides access to resources and knowledgeable members who can help. Benefits of membership include access to a gallery containing thousands of cards with historical pricing information, and access to our entire collection of newsletters, from 1994 through the present day.

You can look at recent sales on auction sites, however, there are some considerations to keep in mind when doing this. Firstly, it’s important to look at selling prices, rather than asking prices. Selling prices are the prices people actually paid, while asking prices can be very different. Secondly, historical sales on some sites are only saved for 3 months, so you may not find something that exactly matches what you have. Thirdly, it is sometimes possible to see rare or unusual cards sell for lower prices than they should have because people do not understand their worth, the ads don't do justice to the card, they're listed in the wrong category, or any combination thereof.

There are always people in our club who are actively buying cards. Collectors tend to focus on a niche, like gas cards or retail cards, or they might focus on a slightly broader area, like bank cards or travel and entertainment cards. Many of the rarest or most unusual cards will exchange hands in private sales. Please contact us if you are thinking of selling your collection.

You can also sell your old credit cards on online marketplaces. You will get the highest price if you sell each of your cards individually, although this approach requires the most effort. At the opposite end of the effort scale would be selling all cards as a job lot, an approach which typically results in the lowest price on a per-card basis. Halfway between these two approaches would be to group cards into different categories and to sell these individual groups, e.g., BankAmericard, Master Charge, oil and gas, retail, and so on.

To join the club, visit the membership section and complete the registration form. You can pay by check or PayPal. We offer annual or lifetime memberships. If you have any questions please contact us via the form on our website.

Credit cards are more worthwhile collecting if they are rare, in good condition, have historical significance, or are associated with famous personalities or events. Valuable modern cards might include those that are difficult to obtain, such as American Express Centurion (a.k.a. ‘black’) cards, while older credit cards might include early independent bank cards, American Express, Diners Club, or BankAmericard (Visa) cards from the 50s/early 60s, or Master Charge (MasterCard) cards from the late 60s. Rare or unusual cards can also be sought after, such as those issued in small numbers, like small independent department stores or gas stations, or cards with appealing aesthetics.

Consulting with other collectors or experts in the club can provide valuable insights. Contact us for more information via the form on our website.

We do not offer an appraisal service in a traditional sense (such services are normally a paid service) but we can connect you with an expert who should be able to assist for free and point out anything rare or unusual in your collection. The simplest way to do this is to submit an inquiry via our contact form.

The American Credit Card Collectors Society accepts donations and is most grateful for any we receive. When donations happen, we strive to find good homes for cards where they will be looked after, matching cards with collectors who will appreciate them. The club may charge members a nominal fee for donated cards, and the proceeds are offset against the running costs of our club. We are a non-profit organization. Running costs include expenses like our convention and website hosting. Donations are most popular for people getting out of the hobby, or when someone has inherited a collection and doesn’t know what to do with it.

If you wish to donate your collection, please contact us via the contact form above.

American Credit Card Collectors Society