If you've lost a job and are struggling during the pandemic, choosing the right credit card could relieve stress
By: My Rate Compass
TORONTO - Aug. 13, 2020 - PRLog -- Finding the best credit card to help pay bills is more important today than ever before, especially if you're under financial stress during the COVID-19 pandemic.
"We're offering unbiased advice on more than 200 Canadian credit cards. Our free on-line credit card course and free credit card guidebook can help you understand and choose the best credit card that will work for your specific needs," said Mohamed Konate Founder of MyRateCompass.ca.
For example, those struggling financially, the MBNA True Line® Gold Mastercard® is an excellent option to consider. Although it has an annual fee of $39, it has a low interest rate of 8.99 per cent.
Another great option is the Scotiabank Value® Visa* Card, which has a standard interest rate of 12,99 per cent for both purchases and cash advances and currently has an introductory interest rate of 0.99 per cent on balance transfers for the first 6 months.
During these tough times, you should also be looking at cash back or point redemption cards at places where you shop.
"With COVID-19, people have to manage their cards well and leverage their cash back and points cards. We're seeing many people redeeming points for groceries," said Konate.
If you have existing credit card debt and are finding it difficult to manage, you could find a balance transfer credit card offer with a low or zero percent promotional interest rate for six or 12 months. However, note there is normally a balance transfer fee, which is typically between one to and three per cent of the transferred amount.
"There is one caveat when choosing a balance transfer promotional offer. Make sure to pay off that balance before the end of the promotional interest rate period, otherwise the standard interest rate will apply to your balance, and that rate will be high.
"If you're carrying a balance every month look for a credit card with a low interest rate. You can find some as low as 7.99 per cent," said Konate.
A credit card is a powerful financial tool for people who understand how to use it. For those interested in strengthening their financial literacy, the website has a free online credit card course geared to helping improve your knowledge of credit cards.
"To maximize the potential of a credit card, and fully make the best use of it, you need to understand how it works and how to leverage it as a financial tool. The course breaks down different credit cards, fees, interest rates, grace period and much more," said Konate.
COVID-19 has affected everyone with many Canadians losing jobs and watching their finances. Now, more than ever, it is important to understand the credit card fees being charged. It is recommended that you review and understand your credit card holder agreement, which is the contract between you and the financial institution.
For example, some people are not aware that there's a fee for going above your limit. People also need to understand the credit utilization rate. If you have a credit card with a $2,000 limit but you're always carrying a monthly balance of $1,900, it will negatively affect your utilization rate of 95 per cent in this scenario.
For a good utilization rate, it's suggested to avoid spending more than 30 percent of your credit limit otherwise it looks like you're not managing money well, which could have a negative impact on your credit score. When a financial institution pulls your credit information, they will see all your debts and see your credit utilization rate for each revolving debt.
"A negative credit score could also affect you several ways. It impacts your ability to find a mortgage, buy insurance, even your ability for finding a new a job," said Konate.
MyRateCompass.ca is an online comparison and ranking resource for credit cards. It helps Canadian consumers evaluate and understand their options to make informed decisions when choosing credit cards.
It's a one-stop shop for selecting the best Canadian credit cards and offers objective and valuable information to help you search, compare, choose, and apply for credit cards. To learn more visit www.myratecompass.ca. For further information or to schedule an interview contact Mohamed Konate at 416-841-6615 or firstname.lastname@example.org.