3 Credit Card Myths-Busted
See updated MyStyle® Checking benefits as of August 1, 2022
Having a hard time balancing everything you've heard about credit cards with what's actually true? We're here for you!
Excessive credit card debt is something you should avoid, but that doesn’t mean you shouldn’t use credit cards. In fact, there are several financial benefits of paying with credit. Don’t be fooled by these common myths:
Myth 1: Opening a new credit card will damage my credit score.
When you open a new credit card, your credit score will drop initially when the lender checks your credit—but only by a few points.
Fact: Credit cards can build your credit.
If you use a credit card and pay it off regularly and on time, your credit score will improve because of utilization. A higher credit score will make it easier to get approved for a loan when you are ready to buy a car, home or other large purchase. To get the biggest credit boost, pay off your card every month and keep your balances under 30% of your credit limit.
Are you a MyStyle® Checking accountholder? Track your credit score for free through our mobile app!
Myth 2: Getting a credit card will lead to debt.
When using a credit card, always stay within your budget and pay off the balance at least once a month. With our mobile banking app, you can transfer money in just a few seconds from your checking or savings to pay your balance.
Fact: Credit cards can earn rewards that save you money.
If you use our Visa® Rewards card for everyday purchases, you can earn cash back, event tickets, gift cards and more—which can save you money. Use your card for expenses like groceries and gas, and you could earn a free ticket home for the holidays!
Note: If you tend to carry a balance, our Visa Low Rate card might be a better option for you.
Myth 3: It’s more financially responsible to use a debit card.
Debit and credit cards can both be great financial tools. However, if someone steals your debit card, your account can be drained before you even realize it, which can put a strain on your finances until that money is refunded.
Fact: Credit cards may offer more legal and financial protection.
According to Matt Farrow, AVP of payment and card services at Mountain America Credit Union, “Credit card companies may provide additional protection for purchases, including accident coverage for rental cars and reimbursement for damaged, unaccepted or undelivered items. It’s important to read the terms and conditions of a card to understand the benefits offered. Additionally, your card is protected from unauthorized purchases if it’s lost or stolen.”
For more information about federal laws that protect you from liability, visit consumer.ftc.gov.
Using a credit card for everyday purchases can build your credit safely while you earn rewards. What’s stopping you from enjoying the perks of a rewards card?
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