Which Credit Card is Best for You?
Credit cards often get a bad rap in the world of personal finance. The negative connotations aren’t entirely unjustified. When used poorly and mismanaged, credit cards can lead to a world of trouble for you and your money.
With high limits and even higher interest rates, you can quickly rack up an overwhelming amount of debt if you charge more than you can afford to repay to your credit card and then start carrying a balance.
But credit cards can also be useful tools to help you leverage your cash flow. If you only charge what you allocated to spend and pay off the balance in full and on time every month, you can make every dollar in your budget stretch just a little bit further through reward points and cash back on purchases you needed to make.
You can start by choosing the best credit card for you based on your spending habits and financial goals.
If You Want to Make the Most of Every Dollar You Spend…
You’ll want to check out a great cash back credit card. These cards allow you to earn money for every transaction you make. Most offer a minimum of 1% cash back on all spending, and some of these rewards cards allow you to earn more based on the category you spend in (like 3% on gas or 2% on groceries).
For the best everyday spending cash back credit card, check out the Citi® Double Cash Card. It has no annual fee, allows you to check your FICO score monthly with your statements, and offers 1% back on all your purchases. The best part? You can earn an additional 1% (for a total of 2% cash back) when you pay your statement on time.You receive your cash as a statement credit, check in the mail, or gift card.
This means you’re rewarded when you practice good credit card management: you earn more when you pay your bill! You can receive your cash as a statement credit, check in the mail, or gift card.
If you’re willing to keep up with the spending categories you spend the most in and update them throughout the year, you may want to try the Chase Freedom® card. This requires that you have a good understanding of your budget and where you spend the most money.
You can earn 5% cash back on specific bonus categories that rotate each quarter. In the past, those categories included gas, groceries, and restaurants. You also earn 1% cash back on all other purchases.
The drawback is that you need to update your bonus category multiple times throughout the year, and if you don’t spend in that particular category you’ll only get 1% cash back. But there’s no annual fee on this card, either, making it a good choice for saving more in specific areas of your budget.
If You Want to Travel More…
Cash back cards are great if you want to keep things simple and save a little bit of money on your everyday purchases. But because the credit card issuer allows you to earn that reward in dollars, the reward is worth a little bit less than if you earned rewards in points.
What if one of your financial goals is to travel or take more vacations? In this case, the best credit card for you would be one that was specifically designed to reward you for spending you did on travel. That’s because points you redeem through reward portals are worth more than if you cashed those points in for dollars.
The Capital One® Venture® Rewards Credit Card provides the best bang for your adventure buck by allowing you to earn miles that can be redeemed on any travel purchase. You can earn 2 points per $1 spent. The card will give you a one-time bonus of 40,000 miles if you spend $3,000 within the first 3 months of opening the card (which is worth $400 when you apply it to travel expenses).
If you’ve looked into travel and rewards credit cards, you may have heard of the Chase Sapphire Preferred card, too. It’s the cool kid on the block right now and a really popular option (for good reason; it does offer nice perks and rewards). But there are a few reasons you may want to go with the Venture card over the Sapphire:
- The Venture card’s fee is lower ($59 versus $95, although both are waived in the first year).
- The Sapphire card’s bonus is higher at $500-$625, but the exact value depends on how you redeem the bonus. The Sapphire requires you to redeem rewards through Chase’s platform to get the best rate, which reduces flexibility for people who aren’t super serious about reward/travel hacking.
- The Venture card is more flexible, allowing you to redeem rewards at a solid rate on ANY travel expenses, not just airfare or hotels but things like taxi rides, some restaurants, other fees incurred while traveling, etc.
Are you loyal to an airline or a hotel chain? Look into their credit card offers, too. You might get more out of your reward points if you know you’re sticking to a particular brand when you take trips (just watch out for higher fees or lower reward values).
If You Want to Learn Better Credit Habits…
Rewards cards aren’t the only options out there, and they may not make sense for you if you currently struggle to manage your debt or spending. Cash back cards or ones that allow you to earn points may increase the temptation to spend (since, technically, you get “rewarded” for doing so).
If that’s the case, you might want to look for credit cards that are no frills, offer manageable credit limits, and won’t charge high fees that are easy to get approval for even with low credit. Here are some options to consider:
- Digital Federal Credit Union Visa Platinum Secured Credit Card: This is a great option thanks to it’s $0 annual fee and it’s extremely low APR of just 11.75%. You do need to join the Digital Federal Credit Union before you can apply for the card, but it’s worth considering if you qualify for membership.
- Citi Simplicity® Card with No Late Fees: Tend to forget about your credit card payment? This Citi card promises not to charge you a late fee, and also offers APRs as low as 13.99% (and there’s no annual fee, either!).
- Discover it® Secured Card with No Annual Fee: Most cards that are good for building credit don’t offer any kind of rewards, but this one will allow you to earn 2% cash back on up to $1,000 on restaurants and gas every quarter and 1% on all other purchases
What to Keep in Mind When Choosing a Credit Card
This should help you get started, but there are countless credit card options out there and you may want to evaluate more choices before making a final decision. Here’s what to think about when comparing cards:
- Note the APR on a card so you know what you’ll need to pay if you start carrying a balance. Some reward cards come with interest rates of 25% or more.
- The most cash back a card offers, the more complicated the rules around earning that cash will likely be. Make sure you understand how you can earn a promised reward, so you’ll know if you’re willing to jump through any hoops required.
- More rewards usually mean more fees. Review the card terms and conditions carefully and note any annual fees or other charges you need to pay to use the card.
- If there’s a signup bonus, note the terms of receiving the reward. Most require you to spend a certain amount of money in a set period of time (like $3,000 in the first 3 months) in order to receive the bonus. Don’t spend more than your budget allows just to get that extra reward! The cash in your pocket today is worth more than credit card points.
Ultimately, credit cards can be great financial tools — but it never makes sense to spend just to try to get status or rewards. Stick to your personal financial plan and don’t charge more than you can afford (or planned to spend) to any credit card you use.
Rosie the Robot, Amazon, and the Future of RAAI
Written by: Travis Briggs, CEO at ROBO Global US
It’s tough to find a kid out there who hasn’t dreamed about robots. Long before artificial intelligence existed in the real world, the idea of a non-human entity that could act and think like a human has been rooted in our imaginations. According to Greek legends, Cadmus turned dragon teeth into soldiers, Hephaestus fabricated tables that could “walk” on their own three legs, and Talos, perhaps the original “Tin Man,” defended Crete. Of course, in our own times, modern storytellers have added hundreds of new examples to the mix. Many of us grew up watching Rosie the Robot on The Jetsons. As we got older, the stories got more sophisticated. “Hal” in 2001: A Space Odyssey was soon followed by R2-D2 and C-3PO in the original Star Wars trilogy. RoboCop, Interstellar, and Ex Machina are just a few of the recent additions to the list.
Maybe it’s because these stories are such a part of our culture that few people realize just how far robotics has advanced today—and that artificial intelligence is anything but a futuristic fantasy. Ask anyone outside the industry how modern-day robots and artificial intelligence (AI) are used in the real world, and the answers are usually pretty generic. Surgical robots. Self-driving cars. Amazon’s Alexa. What remains a mystery to most is the immense and fast-growing role the combination of robotics automation and artificial intelligence, or RAAI (pronounced “ray”), plays in nearly every aspect of our everyday lives.
Today, shopping online is something most of us take for granted, and yet eCommerce is still in its relative infancy. Despite double-digit growth in the past four years, only 8% of total retail spending is currently done online. That number is growing every day. Business headlines in July announced that Amazon was on a hiring spree to add another 50K fulfillment employees to its already massive workforce. While that certainly reflects the shift from brick-and-mortar to web-based retail, it doesn’t even begin to tell the story of what this growth means for the technology and application firms that deliver the RAAI tools required to support the momentum of eCommerce. In 2017, only 5% of the warehouses that fuel eCommerce are even partially automated. This means that to keep up with demand, the application of RAAI will have to accelerate—and fast. In fact, RAAI is a key driver of success for top e-retailers like Amazon, Apple, and Wal-Mart as they strive to meet the explosion in online sales.
From an investor’s perspective, this fast-growing demand for robotics, automation and artificial intelligence is a promising opportunity—especially in logistics automation that includes the tools and technologies that drive efficiencies across complex retail supply chains. Considering the fact that four of the top ten supply chain automation players were acquired in the past three years, it’s clear that the industry is transforming rapidly. Amazon’s introduction of Prime delivery (which itself requires incredibly sophisticated logistics operations) was only made possible by its 2012 acquisition of Kiva Systems, the pioneer of autonomous mobile robots for warehouses and supply chains. Amazon recently upped the ante yet again with its recent acquisition of Whole Foods Market, which not only adds 450 warehouses to its immense logistics network, but is also expected to be a game-changer for the online grocery retail industry.
Clearly Amazon isn’t the only major driver of innovation in logistics automation. It’s just the largest, at least for the moment. It’s no wonder that many RAAI companies have outperformed the S&P500 in the past three years. And while some investors have worried that the RAAI movement is at risk of creating its own tech bubble, the growth of eCommerce is showing no signs of reaching a peak. In fact, if the online retail industry comes even close to achieving the growth predicted—of doubling to an amazing $4 trillion by 2020—it’s likely that logistics automation is still in the early stages of adoption. For best-of-breed players in every area of logistics automation, from equipment, software, and services to supply chain automation technology providers, the potential for growth is tremendous.
How can investors take advantage of the growth in robotics, automation, and artificial intelligence?
One simple way to track the performance of these markets is through the ROBO Global Robotics & Automation Index. The logistics subsector currently accounts for around 9% of the index and is the best performing subsector since its inception. The index includes leading players in every area of RAAI, including material handling systems, automated storage and retrieval systems, enterprise asset intelligence, and supply chain management software across a wide range of geographies and market capitalizations. Our index is research based and we apply quality filters to identify the best high growth companies that enable this infrastructure and technology that is driving the revolution in the retail and distribution world.
When I was a kid, I may have dreamed of having a Rosie the Robot of my own to help do my chores, but I certainly had no idea how her 21st century successors would revolutionize how we shop, where we shop, and even how we receive what we buy - often via delivery to our doorstep on the very same day. Of course, the use of RAAI is by no means limited to eCommerce. It’s driving transformative change in nearly every industry. But when it comes to enabling the logistics automation required to support a level of growth rarely seen in any industry, RAAI has a lot of legs to stand on—even if those “legs” are anything but human.
To learn more, download A Look Into Logistics Automation, our July 2017 whitepaper on the evolution and opportunity of logistics automation.
The ROBO Global® Robotics and Automation Index and the ROBO Global® Robotics and Automation UCITS Index (the “Indices”) are the property of ROBO who have contracted with Solactive AG to calculate and maintain the Indices. Past performance of an index is not a guarantee of future results. It is not intended that anything stated above should be construed as an offer or invitation to buy or sell any investment in any Investment Fund or other investment vehicle referred to in this website, or for potential investors to engage in any investment activity.
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