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The Most Common Questions about Credit Cards


Many people have credit cards, but how many truly understand their credit card and how to use it effectively? As consumers, we constantly face decisions between whether to pay using credit or debit. Below we have pulled together the most commonly asked questions about credit and credit cards. We hope this helps clarify any questions you might have!

1. How is a credit card different from a debit card?

a. A credit card allows consumers to borrow funds, from the institution that supplied the credit card, with the agreement that the money will be paid back with interest. Where as a debit card draws directly from funds that have been deposited in the consumers bank account.

2. Should I use a credit card instead of cash?

a. There is not a definitive answer to this question. Trends would indicate that less people are carrying a substantial amount of cash nowadays, so for that reason using a credit card would be more convenient for consumers. On the other hand, using cash eliminates the possibility of accruing debt and late fees.

3. Is there an age restriction on acquiring a credit card?

a. The simple answer to this is yes. It all depends on the credit card institution; however the typical minimum age requirement for a credit cardholder is 21 years old. The caveat to this is that a parent can authorize a user under the age of 18 to be an approved user of a credit card.

4. What does being “pre-approved” for a credit card mean?

a. You have probably received some mail stating that you have been “pre-approved” for a credit card at some point. If you have, this means that an institution has confirmed with a credit bureau that you meet the requirements to qualify for its’ credit card offerings. However, there is still an application process in which you can be officially accepted or denied as a cardholder.

5. If I no longer use a credit card, should I cancel it?

a. Not necessarily. There is value in being a long time cardholder when it comes to maintaining a good credit score. So, even if it is a card you rarely use, making sure it is paid off and managing it correctly can be vital to establishing a solid credit history.

We understand that there can be a lot of questions surrounding credit, so we hope that the above answers can be of some help. If you have further questions about credit or establishing a good credit score, we’d love to have the chance to talk with you! Come in and see us!

If you are interested in acquiring a credit card, visit the following link to get started! https://bit.ly/3vv4zHh

*Loans subject to credit qualifications. CES Credit Union is federally insured by NCUA.*

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