SoFi

A Clear Plus membership — the paid kind — can be a valuable credit card perk since it can help you get through airport security more quickly and easily by using biometric identification.

An individual Clear Plus membership currently costs $189 a year, plus $99 for each additional person, so getting a credit card that has a Clear Plus membership as a perk might save you money. However, such cards do usually carry annual membership fees that may be comparable (or even higher).

Here’s the information you need to understand if Clear would benefit you and make the right decision about a credit card offer that includes Clear membership.

What Is Clear?

Clear is a for-profit technology company that allows members to use biometric data (such as fingerprint, eye, and face scans) to verify their identity for entry into stadiums, venues, and — in the case of their paid membership — through airport security.

Clear Plus can help frequent travelers verify their identification at the airport more quickly than with a traditional ID, but those who do not have a TSA PreCheck membership or Global Entry will still need to go through regular security. (Even people who do have these memberships are still subject to a more pared-down security check.)

There’s also a free version of Clear, but it’s only used in sports stadiums and other venues to speed entry, not at the airport.

Benefits of a Clear Membership

Essentially, a Clear Plus membership allows you to skip the security line, but not the security process. Instead of getting in line and getting out your boarding pass and ID, you’ll approach a Clear Plus kiosk and an attendant will help verify your identity using biometric markers.

You’ll then be escorted to the front of the security line to go through either the pared-down TSA PreCheck security screening, if you also have that membership, or the regular security screening.

Keep in mind, too, that not every airport is retrofitted with Clear kiosks. Although the technology is in more than 50 airports across America, that’s not every domestic US airport. And the service is not yet international either.

Recommended: Different Types of Credit Cards

Clear Requirements

To get a Clear Plus membership, you’ll need to be a US citizen or permanent resident at least 18 years old, and provide one of the following forms of photo identification:

•   U.S. driver’s license

•   U.S. passport

•   U.S.-issued permanent resident card

•   U.S.- or state-issued military ID

•   Global Entry card

Recommended: Store Cards vs. Credit Cards

How Much Does Clear Plus Cost

Clear Plus, which is the type that gets you through airport security lines, costs $189 per year and then an additional $99 per person for up to three adults on a family plan.

Although it’s called a family plan, both friends and family members are allowed to share a membership in this way, whether the group or family travels together or separately. Plus, children under the age of 18 can travel with you in the Clear line for free.

Examples of Travel Credit Cards With Clear Membership

Credit card issuers come up with new credit card reward programs all the time. That can be one of the benefits of using a credit card.

Most of the credit cards that come with a free Clear Plus membership — or a statement credit in the amount of the purchase price of your Clear Plus membership — are travel credit cards designed to help people earn rewards for flying, staying in hotels, renting cars, and other travel-related activities.

For example, airline credit cards often come with Clear membership perks.

Keep in mind that these credit cards often come with substantial annual fees; they may be premium or no-limit credit cards. For instance, the American Express Platinum Card offers a $189 Clear Plus membership credit, along with many other travel-related perks, but it also has an annual fee of $695.

For frequent travelers, the perks may easily pay for themselves, but, for occasional travelers, it might make more sense to simply purchase a Clear Plus membership. Deciding which kinds of credit card rewards are best for you is a very personal decision.

How to Use Clear

Once you enroll in Clear Plus, using it is easy: You simply walk up to a Clear kiosk at the airport instead of getting into the security line, and the technology as well as the attendants will help you verify your identity. You’ll then be escorted to the front of the security line in order to go through your appropriate security lane.

Where to Use Clear

Clear is not available in all American airports, but it is available in more than 50 of them, including popular destinations like:

•   Chicago Midway International Airport

•   Dallas/Fort Worth International Airport

•   Denver International Airport

•   Harry Reid International Airport (Las Vegas)

•   Hartsfield-Jackson Atlanta International Airport

•   John F. Kennedy International Airport (New York)

•   LaGuardia Airport (New York)

•   Logan International Airport (Boston)

•   Los Angeles International Airport

•   Miami International Airport

•   Newark International Airport

•   O’Hare International Airport

•   Ronald Reagan Washington National Airport (Washington D.C.)

•   San Francisco International Airport

The Clear membership can also be used in many sports stadiums and concert venues across the country. You can find the full list at Clear’s website. And worth noting: Clear Plus strictly helps a person move through airport security; it doesn’t have any benefits (at least not at this time) in terms of the cost of airfare or other aspects of transportation.

The Takeaway

You may see offers of credit cards with Clear Plus membership included as a perk and wonder if it’s right for you. If you’re a frequent flier, a Clear Plus membership may help you save time at the airport. Depending on its other benefits and its annual membership fee, a credit card that comes with a Clear Plus membership may be a money-saving way to access this service.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Is it worth it to get a Clear Plus membership?

It depends on whether or not you’re a frequent traveler — and whether or not the airports you frequently travel through are equipped for Clear identity verification. If you travel very frequently, Clear Plus may help you save time at the airport security line, but it doesn’t exempt you from needing to go through security clearance.

What are the benefits of being a Clear member?

When you purchase a Clear Plus membership, you are able to skip the photo identification verification process, which can be time consuming. Instead, you’ll head straight to the Clear kiosk, where your identity is verified using biometric markers such as eye scans and fingerprints. You also get to skip the security line, though you and your baggage still have to go through the security screening process.

What is the difference between Clear and Clear Plus?

Clear is the free version of the service, which allows you to use Clear technology to verify your identity at stadiums and arenas. Clear Plus is the paid service that allows you to verify your identity biometrically and skip the security line at the airport.

Photo credit: iStock/damircudic

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOCC1023015

Buying with a credit card can offer such benefits as convenience, safety, and rewards. Whether you’re shopping for shampoo or a new sofa, there are many ways that you can pay for goods and services. You can use cash, checks, electronic payment, debit cards, or credit cards. Not every merchant may accept each of these forms of payment though, but credit cards are one very popular and useful option.

Here, you’ll learn more about the benefits of credit cards vs. other forms of payment, so you can know when to break out the plastic and when to spend with something else.

What Is a Credit Card?

What is a credit card? First, to be really, really literal: A credit card is a rectangle made of plastic or metal issued by a financial service company. It allows cardholders to borrow money to pay for goods and services with merchants that accept credit card payments.

Credit cards are different from debit cards in that they don’t whisk money out of your checking account right away. They also vary from a personal loan or a personal line of credit.

•   When comparing a personal line of credit vs. credit card, both are types of revolving credit, report your balance and payment info to the major credit bureaus, and charge interest. But unlike credit cards, personal lines of credit don’t offer rewards, can have a lengthy application process, and can have a lower borrowing limit than credit cards sometimes.

•   When comparing credit cards vs. personal loans, they both allow a borrower to access money that they have to pay back later, and they are both usually unsecured. However, credit cards are a form of revolving debt (meaning you can borrow money repeatedly, up to a limit), while personal loans are not.

Why Are Credit Cards Useful

Credit cards are incredibly useful for paying for everyday purchases, however big or small. In a minute, you’ll learn more about specific credit card benefits.

But, to look at the big picture of why credit cards are useful, consider the following:

•   They are convenient to carry and use.

•   They can allow you to spend and then pay off your debt over time.

•   There’s typically a grace period before you begin paying back the debt, an advantage over debit cards.

•   They can offer rewards, such as cash back.

•   Credit cards typically offer fraud protection.

•   Credit cards can help you build your credit history.

Credit Card Benefits

There are many benefits to having and using a credit card. As long as you use your credit card responsibly, these perks can be incredibly useful. Benefits to having a credit card include safety, rewards, tracking your spending, security, convenience and building credit. Here’s a closer look.

Safer to Carry and Use

If you lose a credit card or it gets stolen, you most likely won’t be held financially responsible for fraudulent purchases that someone else may make with your credit card. In some cases, you might be liable for no more than $50, even if someone charged much more on your card. Credit cards may also protect you when you have a dispute with a merchant.

On the other hand, if you lose cash or it gets stolen, there is almost no way to track that cash down and get it back. If you lose a debit card or it’s used fraudulently, you most likely will get the money back, but it can be a more difficult process than a credit card. And you may have to wait longer to get your cash refunded than if the situation occurred with a credit card.

Credit Card Rewards

Credit card rewards can be incredibly lucrative and useful. Some credit cards offer a flat-rate percent back on every purchase you make. Others have bonus categories where you can earn a higher rate of rewards on those purchases.

Credit card rewards can come in the form of cash back (say, 2% cash back on purchases), miles, or points that you can use for travel or other things. However, while the promise of rewards can be enticing, don’t spend more than you normally would just to get additional credit card rewards.

Track Spending

Credit cards can help make it easier to track your spending. If you use cash or check, you might have to keep track of your spending yourself (it’s basic math, but many people don’t want to deal with it), whether by paper or by creating your own electronic system or file.

With a credit card, all of your spending shows up online in your account, and within a few days of making the purchase. Plus, many credit card issuers automatically categorize your purchases into different types of spending, which can make it easier to stick to your budget. You can see how much you have spent in different categories each month, and you can export the data to some popular budgeting apps.

Security

As briefly noted above, most credit card issuers offer zero fraud liability to cardholders, which can add a layer of security. Zero fraud liability means if you report fraudulent activity on your account to your card issuer right away, you likely won’t be liable for those fraudulent activities. The issuer will usually refund any amount fraudulently charged to the card and issue a new card and card number to the cardholder.

Plus, many card issuers have alert systems that notify cardholders via email, text, or phone call when suspicious activity is detected. Cardholders can confirm or deny that they made these purchases. This allows any potentially fraudulent activity to be caught right away.

These protections are not available for most debit cards and obviously not when you are using cash.

Convenience

Visa and Mastercard, two of the most common credit card networks, are accepted nearly everywhere worldwide. American Express and Discover, the other two credit card networks, are widely accepted in the United States and occasionally in other countries. Wide acceptance makes credit cards convenient to use for everyday purchases.

Credit cards can be used in person, online, or over the phone to make purchases. They are also easy to carry with you all the time, and you don’t need to think about replenishing your money like with cash.

Building Credit

Responsible use of a credit card can actually help you build credit. If you pay at least your minimum amount due on time each month, you may build your credit score over time. (You’ll want to avoid, however, letting your credit utilization, or the percent of your credit limit that you spend, get too high.) Having good credit is important for many reasons, including getting a mortgage, applying for a job, or renting an apartment.

Recommended: Do Store Cards Help Build Credit?

When Not to Use a Credit Card

Even though credit cards are incredibly useful, there are times when it doesn’t make sense to use a credit card.

•   If you have to pay an extra fee to use the credit card, it may make more sense to pay by another method that doesn’t come with a fee, like cash, check, or debit card. Merchants pay processing fees when customers use credit cards and sometimes merchants pass along those processing fees to the customer. Unless the credit card rewards are high enough (like if you are working on a credit card sign-up bonus) that it offsets the fees, you are better off avoiding those fees.

•   Also, if you are carrying a balance and don’t expect to pay it off this month, you are likely paying not just for your purchase but for interest charges as well. So it could be wiser, if possible, to use a debit card when making a purchase.

•   Credit cards may also not be the best choice for you if you have a hard time controlling your spending. Since purchases made with a credit card don’t come directly out of your bank account, it may be tempting for some people to spend more than they can really afford to. If you’re an impulse shopper, proceed with caution. Swiping or tapping with a credit card can be so easy, it may make some people forget that, yes, the bill will actually be coming their way.

Examples of Credit Card Usage

Credit cards can be used to pay for goods and services. You can also finance purchases with a credit card. Also, you can use your credit card benefits such as travel insurance and purchase protection. And it can be used for purchases big and small.

•   Say that you see a $1,200 plane ticket to your friend’s destination wedding. It looks as if prices are only going to rise, but you don’t have that sum of money available. You could use your credit card to book the flight, and then pay it off over time.

•   Or you might be out for a run and, on your way home, remember that you’re out of coffee. If you have your credit card zipped into a pocket, you can easily pay for your coffee vs. having to go home, grab your wallet, and head out again.

Recommended: What to Buy With a Credit Card to Build Credit

Examples of Credit Card Issuers

A credit card issuer is the company that provides the credit card to the consumer. Issuers approve or deny a credit card application, decide how much credit to extend to the customer, determine the terms and benefits, and collect cardholder payments.

Some of the major credit card issuers include:

•   American Express

•   Bank of America

•   Capital One

•   Chase

•   Citi

•   Discover

•   U.S. Bank

•   Wells Fargo

Examples of Credit Card Networks

Credit card networks facilitate transactions between merchants and card issuers. They charge merchants fees for processing consumers’ card transactions.

The four major credit card networks are:

•   American Express

•   Discover

•   Mastercard

•   Visa

American Express and Discover are also credit card issuers. The other credit card issuers typically use either Visa or Mastercard networks.

Credit Card Tips

Understanding how credit card payments work is important so that you can maximize the credit card’s benefits.

•   Only charge what you can afford, and pay your bills on time each month.

•   Pay the full balance if you are able to, or aim for at least more than the minimum amount.

•   Review your credit report regularly to make sure everything about your credit card account is accurate.

•   Don’t share your card number, CVV, or additional details with anyone else.

The Takeaway

Credit cards have many benefits. They can be convenient; reward you with perks like cash back; and offer protection in case of loss, fraud, and disputes. Many people find them a convenient way to make a large purchase and pay it off over time. However, if you don’t use your credit card responsibly, the benefits may not outweigh the downsides.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Do credit cards help your credit score?

Responsible use of a credit card can help you build credit. If you pay at least the minimum due every month, you can establish an on-time payment history, which is a positive thing. However, you need to watch your credit utilization ratio, the amount of your credit card limit that you are spending.

Can store credit cards help you build credit?

Most credit cards will help you build credit, as long as you are paying your debt on time and the card reports data to the credit card bureaus. Even store credit cards build credit as long as the card meets this criteria.

What are the benefits to credit cards?

There are many benefits to having and using a credit card. These can include safety, rewards, tracking your spending, convenience, and building credit.

Photo credit: iStock/pixelfit

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

SOCC1023017

Some credit card companies may lower your rate if you ask. Which can be a good thing given that the current average interest rate is currently hovering over 20%. Getting that “yes” answer could be a simple way to shave money off your bill if you don’t pay the balance in full every month.

Given that it can’t hurt to ask, read on to learn more about this topic, including tips for requesting a lower credit card interest rate.

How to Lower Your Credit Card Interest Rate

First, a bit of vocabulary. Your credit card interest rate is also called an annual percentage rate, or APR. Credit card APRs vary across cards and cardholders. The APR that you currently have on your credit card is not set in stone.

It is often possible to lower your credit card interest rate. To do so, you will need to contact your credit card issuer directly. Although the credit card issuer is not required or guaranteed to agree to lower your APR, it is likely worth the time and effort to try. The worst that can happen is they say no, right?

Plus, you might be pleasantly surprised to learn that they can decrease the interest rate a bit. For instance, if you let them know you are shopping for a better rate elsewhere, they might lower your rate a bit to keep your business.

Why Try to Get Your Rate Lowered

If you carry a balance on your credit card, you have to pay the interest on your balance. If you have a high interest rate, it can make it more difficult to get out of debt if you get behind on the payments.

When you make payments on a card with a high interest rate, more of the money will go toward interest, which means it will take longer to pay off the actual balance amount.

Trying to get your rate lowered is actually easier than it may seem. There is no risk to trying, so if you carry a balance on your card, you might as well try to see if you can get your rate lowered.

What Is a Good Interest Rate on a Credit Card?

You have to qualify for the interest rate on a credit card. The credit card interest rate that you wind up with can depend on your credit score, market conditions and the credit card issuer. The average credit card interest rate as of November 2023 according to the Federal Reserve was 22.75%.

Some might say that a good interest rate on a credit card is anything other than that figure. Others might have a particular lower number in mind that they saw advertised by a given financial institution.

Rates change, so it can be smart to check the prevailing percentages before you talk to your card issuer, so you can negotiate more effectively. You may find some promotional credit card interest rates being offered in some cases.

Understanding Your Credit Card Company

While it may seem counterintuitive from how consumers feel, your credit card company may prefer customers who carry a large balance, as opposed to someone who is avoiding interest on credit cards by paying their balance in full every month.

Credit card companies make the most profit from charging interest to people with unpaid balances. If you are one of those people, your card issuer probably doesn’t want to lose you or your balance. This may give you a little leverage for negotiating your APR.

It is also important to know that while credit card companies can agree to lower your APR if you ask, they can also increase your APR for certain reasons.

•   If you are often late on payments, your rate can be hiked up. The credit card company must give you 45 days of advance notice before doing this.

•   Credit card companies are usually not allowed to increase your interest rate on new transactions during the first year of your credit card account, but they can do so after the first year.

How to Negotiate a Lower APR

Learning how to lower APR on your credit card involves learning how to negotiate with your card issuer. To do this, you just need to assess your situation and ask the right person at the credit card company. Here are tips.

Assess Your Situation

Before you approach your card issuer, you should assess your own situation and decide what your goal is. If you have a decent credit score, you may be able to collect competing offers with lower interest rates to bring to your credit card issuer. This may include cards that have credit card promotional interest rates, like balance transfer credit card offers or intro 0% APR offers.

Ask the Right Person

Next, call the customer service number on the back of your credit card. Once you are speaking with a live person on the phone, explain your situation. Tell them about the other offers for lower APRs from other credit card companies, but you would prefer to stick with your current company.

If the customer service representative that you are speaking with says that a lower rate isn’t possible, ask to speak to their supervisor. If they don’t comply with that request, you might hang up and call back again.

What to Do After a Decision

If you were able to get your APR lowered, congratulations. Now, there are a few next steps to take.

•   First, get the credit card issuer’s agreement to lower your rate and the related fine print in writing. Have them mail or email you it.

•   Be sure to read the fine print to understand any conditions that come with the offer. If you have a credit card payment delay or don’t keep your balance under the credit limit, the card issue may be able to raise your APR to the previous rate or an even higher rate.

•   Knowing what can increase credit card APR is important in this instance. Do educate yourself on this topic.

•   Also, consider using the money that you save on interest toward reducing your credit card debt or other debt. By continuing to make payments in the same amount you were making before your rate was reduced, you can work to reduce debt and improve your overall financial situation.

•   If you were not able to get your APR lowered, you can ask your card issuer about their procedures for rate reduction. There may be a time period for consideration or reconsideration. Or you could look into balance transfer promotions with another company.

Recommended: What’s the Minimum Credit Score Needed for a Credit Card?

Credit Card Tips

If you have a credit card, you should have a general understanding of some of the credit card rules.

•   Honor your bill’s due date with at least the minimum payment. On-time payments are the single biggest contributor to your credit score.

•   One of the most important is to only spend what you can afford, and pay your balance in full each month if you are able to. That way, you won’t even have to worry about the APR.

•   If that’s not possible, keep an eye on your credit utilization ratio, or the percentage of your credit limit that you have accrued. If this figure gets too high, it can negatively impact your credit score.

•   Also take steps if your balance is getting too high. You could look into balance transfer cards, a personal loan to pay off your credit card, or working with a nonprofit debt counselor.

The Takeaway

It is possible (but not guaranteed) to get your credit card company to lower the interest rate on your credit card if you ask. When speaking to a representative, be courteous, come armed with information about prevailing interest rates and other offers, and ask to speak to a supervisor if necessary. A lower APR on your credit card can save you a lot of money if you carry a balance, so it can be worth the time and effort.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Can I ask the credit card company to lower the interest rate?

Yes, you can always ask the credit card company to lower the interest rate on your credit card. You can call the customer service number on the back of your credit card.

How can I get my credit card interest rate down?

You may be able to get your credit card interest rate lowered by contacting the credit card company directly. You should do research on competing offers to use as examples when speaking with your card issuer. Your credit card issuer may not want to lose you as a customer, so they may be able to offer you a lower interest rate.

Can a credit card company change your interest rate without telling you?

Credit card companies can increase your interest rate, but they must give you 45 days of advance notice. Credit card companies are usually not allowed to increase your interest rate on new transactions during the first year of your credit card account, but they can do so after the first year. The credit card company may want to raise your interest rate if you are often late on payments.

Photo credit: iStock/Ridofranz

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

SOCC1023016

If you are wondering how often you can apply for a credit card, the right pace will vary based on the person, their credit score, and the card issuer’s restrictions. While there’s no single hard number when it comes to that query, once every six months is a good pace.

If you have good credit, a more frequent pace can be fine. If you have poor credit, however, you might want to slow things down. Read on to learn the ins and outs of how often you can apply for a credit card.

How Applying for a Credit Card Affects Your Credit Score

If you want to apply for a new credit card, you may be concerned about whether applying for credit cards hurt credit score. Applying for a credit card can affect your credit score in a few ways, including credit utilization, new credit inquiries, the average age of your accounts, and your credit mix. Here’s a closer look.

New Credit Inquiry

There are two types of credit inquiries: hard versus soft credit inquiries. During a soft inquiry, which is also called a soft pull or a soft credit check, a credit card issuer will check your credit, but it won’t affect your credit score.

However, when you apply for a new credit card, the credit card issuer will probably do a hard credit check. Hard credit inquiries do negatively affect your credit score. Every hard inquiry can drop your credit score by up to five points. However, this impact won’t last forever. Hard inquiries remain on your credit report for up to two years but they can only impact your score for 12 months.

Credit Utilization

Credit utilization is the amount of revolving credit you are currently using divided by the total credit available to you. Credit utilization is usually expressed as a percentage. When you open a new line of credit, like a new credit card, your total credit limit increases, and your credit utilization ratio decreases. This can help build your credit score. Experts recommend keeping your credit utilization below 30%.

Credit utilization can affect your credit score. And if you are approved for a new card, when that credit limit is added to your current credit limit, your total maximum will likely increase, which can lower your utilization percentage.

Average Age of Accounts

The longer the average age of your accounts on your credit report, the higher your credit score will likely be for that category. When you open a new account, it will reduce the average age of your accounts. If you have established credit with multiple accounts that are several years old, a new account opening may not have a significant impact. If all of your accounts are new, adding additional new accounts may have a greater negative impact.

Credit Mix

Lenders like to see that borrowers have a variety of different types of credit. This shows that they can handle different types of payments. The impact of opening a new credit card has on your credit mix will depend on your current credit array. If you already have several credit cards, it may not impact your credit score much. If you don’t have any other existing credit cards, opening up a new credit card could improve your credit mix and therefore help build your credit score.

Recommended: How Many Credit Cards Should I Have?

How Often Should You Apply for a Credit Card

Now, about the question of how often you can apply for a new credit card: While there is no hard and fast rule about how often to apply for a credit card, some experts recommend waiting at least six months between credit card applications.

•   Those with poor credit may need to wait even longer between applications to maximize their chances of getting approved for a new credit card.

•   Those with excellent credit can probably apply for a new card more often, like every three months.

Why You Should Wait Before Applying

Here are some reasons why you should think twice and delay before applying for a new credit card:

•   If you don’t know how to use a credit card responsibly, you may want to consider waiting before applying for a credit card.

Worth noting: If you have bad credit from a maxed out credit card, you may want to work on building your credit score first. Some tips:

•   If your credit utilization ratio is high because you don’t have a high credit limit, you could try implementing the 15/3 credit card payment method. The 15/3 credit card payment method is when you make two payments each statement period instead of one. You pay half of your credit card statement balance 15 days before the due date on your statement, and then make another payment three days before the due date. This additional payment can help lower your credit utilization ratio throughout the month, which can also help improve your credit score.

•   Other reasons you may want to wait before applying for a credit card include if you’re buying or refinancing a home currently, since applying for a new credit card can result in a higher mortgage interest rate or potentially being declined from the mortgage altogether.

•   You should also evaluate the credit card benefits and welcome offer to make sure it is the right fit for you and the best offer that you can get. Credit card sign-up bonuses fluctuate throughout the year. Before applying for a credit card, you should do some research to see what the highest offer has been. If the current offer is significantly lower, consider waiting to apply for that card.

How Many Credit Cards Can You Apply for at One Time

Technically, you can apply for as many credit cards at once as you want. However, you likely won’t get approved for all of them. And you could trigger a slew of hard credit inquiries. So putting in a load of applications likely won’t be worth the negative impact on your credit score.

Credit Card Issuer Restrictions

How many credit cards you can apply for at one time will vary based on the credit card issuer. Each card issuer has its own rules and restrictions about applications. American Express, Bank of America, Capital One, Chase, Citibank, Discover, U.S. Bank and Wells Fargo all have their own issuer restrictions regarding applications, cards and welcome offers.

Credit Card Tips

Once you have been approved for an additional credit card, you need to know how to manage multiple credit cards. Try these strategies to stay in good financial health:

•   Understand your obligations. There are several credit card rules to understand so that you maintain your credit score, while taking advantage of the credit card benefits. One of the more important ones is to always pay at least the minimum amount due on time.

•   When you are issued your credit card, it will have an expiration date. The credit card expiration date is usually three to five years after being issued. You can find the expiration date on the credit card itself. After the card expires, the issuer will usually give you a new card, as long as your account is still active.

•   However, what happens if you don’t use your credit card is that the issuer may close your account. So make sure you are using your credit card.

•   Also, make sure you are using your credit card responsibly. That means keeping an eye on your credit limit, your credit utilization ratio, and when your payments are due.

Recommended: What Is a Credit Card Expiration Date?

The Takeaway

How often you should apply for a credit card will depend on a variety of factors, like your credit history, the card issuer, the current offers available, and more. It can be wise to not apply for new credit cards more often than every six months. And once you have a new credit card, make sure to use it responsibly.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

How long should I wait to apply for another credit card after being approved?

Some financial experts recommend waiting at least six months between credit card applications. However, there is no hard and fast rule about how often to apply for a credit card. It will vary depending on your credit score and the restrictions from the card issuer.

Do I have to wait six months to apply for another credit card?

Waiting six months between credit card applications is not a defined requirement. If you have poor credit, you may need to wait longer than six months between applications to maximize your chances of getting approved for a new credit card. If you have excellent credit, you can probably apply for a new card more often, like every three months.

How often can I apply for a credit card without hurting my credit?

Each credit card application results in a hard inquiry, which hurts your credit score temporarily. Keep that fact in mind as you consider applying.

Photo credit: iStock/Eva-Katalin

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOCC1023012

If you’re wondering whether you can pay utilities with a credit card, the answer is likely yes. In many situations, you can break out the plastic and charge your electricity, wifi, phone, and other basic expenses.

That said, while using a credit card as your payment method may be the most convenient option for you, there are some factors to consider to make sure you are doing what’s best for your overall financial picture. While it can help you build credit, some bill processors may charge convenience fees. If you carry a balance on your credit card, you may end up paying interest as well.

In these ways, it may not be the most economical nor the most financially wise move to make. Read on to learn how to size up this situation and decide how to pay your utility bills.

What Bills Can You Pay With a Credit Card?

You typically can pay for most bills using your credit card. Some of these include:

•   Rent

•   Car insurance

•   Medical bills

•   Cell phone bills

•   Internet fees

•   Cable

•   Utilities (like electricity and sewage)

•   Subscription and streaming services

•   Taxes

Recommended: How to Build Credit With a Credit Card

Pros and Cons of Using a Credit Card to Pay Bills

Paying utilities with a credit card may seem like a great choice, there are some risks and downsides. Even if the answer to “Can you pay a utility bill with a credit card?” is yes, it may not be the best move. Consider these pros and cons before making your decision.

Pros

First, consider the benefits of using a credit card to pay your utility bill:

•   Potential to build credit score: Most credit cards report your payment activity to all three major credit bureaus — Experian, Equifax, and TransUnion. Paying consistently on time is one of the main factors that could help build your credit score.

•   Earn rewards: Using a cash back or rewards credit card to pay utility bills could help earn a percentage back on your spending or points toward, say, travel. Some cards may earn you higher rewards than others.

•   Help meet reward signup bonuses: Some credit cards offer a sign-up bonus if you can meet a certain spending requirement within a predetermined amount of time. Since you need to pay utilities every month anyway, charging it on a credit card can get you closer to the minimum spending requirements.

•   Convenient way to track spending: By putting your utility payments in your credit card, you can track it through your credit card statements each month, or when logging into your account online.

•   Easily dispute payments: Say you accidentally pressed the payment button twice, or there are some suspicious charges on your utility bill. Using a credit card means you can dispute it through your credit card issuer.

•   Can set up automatic payments: Depending on your utility company, you may be able to authorize automatic credit card payments. It could be helpful to ensure you pay utilities on time.

Cons

Next, review the potential disadvantages of breaking out your plastic to pay your utility bills.

•   Could negatively affect your credit score: Not paying your credit card bill on time could mean your score takes a dip. Plus, if you use your credit card for more than just utility payments, racking up a large balance could affect your credit utilization ratio (the percentage of available credit you’re using on revolving credit accounts). Higher credit utilization could signal to credit scoring agencies and lenders you need to rely on credit in your financial life. As such, could lead to negative affects on your credit score.

•   Potentially pay fees: Some utility companies charge a convenience fee, which is typically a percentage of your bill amount. In most cases, this fee is to help offset the processing fees charged by credit card companies. The cost may not be able to offset any rewards you earn. Fees can also easily add up if you regularly use your credit card for utility payments. Consider carefully whether this payment method is the best financial choice.

•   Possible interest charges: Aside from potential negative effects on your credit score, you’ll end up paying interest on any balances you carry from month to month. Often, the rates are in the double digits and higher which means you end up paying more overall for your utilities.

Recommended: Does Paying Utility Bills Build Credit?

Should You Pay Bills With a Credit Card?

Paying bills with a credit card can be a smart choice if you’re looking to build your credit and earn rewards. It does mean you need to be mindful of your credit behavior before doing so, or else you could face consequences such as excessive fees and interest charges.

For instance, perhaps you consistently pay your credit card bills each month (ideally the entire balance) and like the buffer you get between the grace period and when the payment is due.

In this case, you may be able to reap the benefits of using a credit card. However, if you get charged a convenience fee each time (and you have multiple bills to pay) and can only afford the minimum credit card payment, then you may want to reconsider using credit cards.

Whatever your choice, be sure to check the terms of your credit so you know when your due date is and other charges such as the interest rate and late fees.

How to Pay Utilities With a Credit Card

There are several options to pay utilities with a credit card, including directly through the utility company or through a third-party processing company. Each option typically asks you to sign up for an account online and verify information such as your address and other personal details. To pay, simply follow the prompts presented to you on the screen. There may be an option to select to charge your utility bills each month automatically.

Before pressing the “submit” button, look for information indicating any convenience fees you’ll pay in dollar amounts. Some utility companies also accept credit card payment by phone — call to check to see if this is an option for you, if you like. You want bill pay options to suit your needs, not just those of service providers.

Recommended: How to Pay Your Bills When You’ve Lost Your Job

How On-time Utility Payments Can Improve Your Credit

Utility payments aren’t directly reported to the three major credit bureaus, so they don’t necessarily have an effect on your credit. However, if you use a method of payment that does report to the credit bureaus — like credit cards — then it could have an effect.

For instance, if you consistently make on-time credit card payments, credit bureaus will report the positive behavior. Credit scoring agencies may look at this behavior more favorably and build your score as a result.

There are some credit bureaus that report your utility payments, but not all do. If you need the answer, you can look at your annual free credit report to learn more.

Tips to Paying Bills With a Credit Card

Whenever you pay by credit card, you’ll want to use your plastic responsibly and carefully. This holds true for paying utility bills by credit card, too. Here are some pointers.

•   Monitor your bank account to ensure there’s enough money when you pay your credit card bill, or you could risk overdraft or NSF fees.

•   Be sure to make at least the minimum credit card payment to prevent late fees and negative impact on your credit report.

•   Check to see whether any convenience fee is worth it or is offset by any rewards you earn.

•   Watch your credit utilization to prevent it from going too high.

•   Monitor your credit card transactions, and report any fraudulent activity.

The Takeaway

In many cases, you can pay for utilities with a credit card. But you’ll need to weigh whether this is the best move for you. It might be a way to conveniently take care of bills, earn rewards, and build your credit. Or it could lead to more credit card debt, interest payments, and convenience fees.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Is it better to pay utilities with a credit card or bank account?

The choice to pay with a credit card or bank account depends on your financial situation and preferences. There are benefits to using a credit card such as earning rewards and tracking your payments, but you may have to pay a convenience fee for the privilege. And you could accrue more high-interest debt if you can’t pay the full balance each month.

Can I pay my mortgage and utilities with a credit card?

In most cases, you can pay your utilities with a credit card. Unfortunately, most mortgage companies don’t allow you to pay your monthly payments with a credit card. There may be third-party processing companies that allow you to do so, but you’ll most likely pay a convenience fee.

Is paying a bill with a credit card considered a cash advance?

No, paying a bill with a credit card isn’t considered a cash advance. However, some aspects of using payment apps, like PayPal and Venmo, may be treated that way.

Photo credit: iStock/miniseries

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

SOCC1023007