While some people like having the ability to make purchases on credit and pay for them over time, others want to pay their balances in full every month, thus eliminating debt and interest fees. Fortunately, both types of cards are available. Many people refer to all such cards as credit cards or charge cards, using the terms interchangeably. In fact, cards that require balances to be paid in full every month are called charge cards because they don't extend long-term credit.
American Express offers Green, Gold, Premier Rewards Gold and Platinum charge cards providing different levels of services and benefits that are especially helpful to travelers. American Express charge cards do not have spending limits the way charge cards do, but they do require balances to be paid in full when monthly statements are received. The level of card a customer is offered is based on the applicant's needs as well as his credit score and credit history. Annual fees for the cards, as of January 2014, range from $95 to $450, with fees for the first year waived for all but the Platinum card.
Chase Ink Bold
Chase Bank offers the Ink Bold charge card for business owners who want to pay their balance in full each month. Users receive double points for the first $50,000 spent annually at gas stations and hotels when booked directly through the hotel, and five points for every point spent on phone, office supply, Internet and cable services. Points can be redeemed for travel, merchandise, gift cards, cash back and activities. As of January 2014, the card has a $95 annual fee but the fee is waived for the first year. Additional cards for employees are available at no cost.
Diner's Club has come a long way since it became the first charge card in 1950. Accepted at 28 New York restaurants and two hotels back then, it's now accepted worldwide wherever MasterCard is accepted. The card for professionals offers redeemable points, car rental discounts and a personal travel assistant. It has a $95 annual fee. Diner's Club also offers corporate charge cards that give users two full billing periods to pay their balance without incurring a late fee.
U.S. Bank offers a business charge card that it says offers the benefits of using a debit card and the advantages of a credit card. Like a debit card, it charges no annual or monthly fees. Like a credit card, it allows users to charge purchases. However, as with other charge cards, balances must be paid in full each month. The card also gives 1 percent cash back on gas, office and cellular services, and one-half percent cash back on all other purchases.
Charge Cards and Credit Scores
Charge cards have the potential to affect credit scores in the same way typical credit cards do. To maintain a good credit score or improve your score, it's important to pay the balance in full on time each month. (Reference 1) If improving your credit score is a goal, be sure the charge card you choose reports to at least one credit bureau.
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