What Your Credit Card Says about Your Personality Type

This is a guest post from Jack B. Jack is a personal finance blogger at MasterYourCard and DebtLoans.com.au where he writes about credit cards and debt consolidation.

You may think that your vanity credit card with pictures of puppies or your alma mater’s mascot is what helps the cashier at the grocery store peg your personality, but in reality, the features and terms of your credit card are far more telling. Of course, no one but you and your issuer know whether you have a low interest rate, cash back rewards or monthly reporting to credit reporting agencies. So, consider this rundown of credit card personality types as an exercise in self reflection. You may learn something about yourself.

The Low Interest Rate Card

You, oh low interest rate seeker, are one who lives in the moment. A true American, you buy now and pay later. You carry a balance today so you can enjoy living beyond your means. To you, that finance charge is well worth having all the things you want, when you want them. You are first in line at Best Buy every Tuesday – ready to be the first to get that newly released DVD, the first to hear the new album from everyone’s favorite band. Sure, you’ll pay more for it in the long run. But you’d rather have something tangible in your hands now than waiting to save up the cash. Of course, you’ll need to be careful: if you charge too many things today, you may not be able to afford the next impulse buy down the road.

Shopaholics who live in the now may enjoy the Capital One No Hassle Miles Rewards or Capital One Platinum Prestige. You’ll pay 0% APR on purchases until May 2010 – but you’ll need excellent credit to qualify.

The Rewards Card

You, my friend, are a bargain seeker. For you, the pride of ownership isn’t satisfying enough. You need something a little extra to make purchases worth your while. But to you, it’s worth it to know that your spending is accruing you extra perks down the road. You’re a modern day coupon clipper – always getting a deal. That’s why you research each of our purchases carefully, diligently ascertaining:

• Where am I going to get the best deal?
• How can I get a discount?
• Who should I buy from to get the most rewards?

With today’s tightening credit card terms, getting the most rewards for your spending habits isn’t always as easy as picking three top categories. Now, you have to shop online through your card issuers partners and keep track of “rotating categories” and “platforms.” It’s a lot of legwork, but that free vacation, free upgrade to first class, $250 cash back or $50 gift card to your favorite retailer is well worth it. You may even opt to pay an annual fee at the chance to earn rewards, because you’ve done your homework and know that it’ll pay for itself in the end.

Looking for free stuff down the road? Get $50 cash back right off the bat with the Chase Freedom Mastercard. Or why not spend towards a nice tropical vacation with your Sandals Resort Platinum Plus Visa Credit Card.

Business Credit Cards

Yes, sir (or ma’am) – you are the boss. As the owner of a small business or the head of your division, you trust your employees to make purchases on behalf of the company. You also have salespeople and consultants on the road on the company dollar. With your business credit card, you can have all of your employees on the same credit account and manage spending limits on each individual user. You can micromanage or delegate all you want – and the best part is, you’re earning rewards for the company the entire time. Way to keep the bottom line in mind, chief!

As a responsible businessman, you’ll enjoy the PartnersFirst Business Rewards Visa Card, which gives you itemized statements for each cardholder and 1% cash back on every purchase. Or how about a Starwood Preferred Guest Credit Card, so your road warriors can sleep in classy comfort.

Poor Credit History Cards

You’ve hit a few rough patches along the way, but you are now on the road to rebuilding your credit. In order to get a second chance at redeeming your credit rating, you’re willing to submit to stricter terms for your credit card. It’ll cost you a bit extra to regain the trust of the credit industry, but if you play your cards right, you’ll be able to qualify for a card with better terms, lower interest rates and lower rewards down the road. You are bootstrapping your way through credit rehab – you’ve sworn to change your ways, and toprove it, you’ll agree to:

• No grace periods
• Annual fees
• Low credit limits or credit limits commensurate with prepayment
• Bigger penalties for late payments

The stakes are high, but this is your last chance. If you can prove that you are reformed, you will be able to rejoin the fold of consumers with good credit. Begin rebuilding your credit with a First PREMIER Bank Gold MasterCard, with a low fixed APR and monthly reporting to the three major CRAs. Rather not go it alone? Get a responsible friend to be your cosigner. Or share the liability with your issuer with a Bank of America Secured Visa Credit Card.

Balance Transfer Credit Cards

You are a declutterer. You found yourself with too many credit cards with too high interest rates and you decided to consolidate. You prefer things to be orderly and simple, so you transferred the balance. Or maybe you have far too many credit cards and you want to remove the temptation to spend by reducing the amount of plastic in your wallet. As a one or two card carrying consumer, you’ll enjoy:

• Paying less annual fees and member charges
• Easier bill management and less mail
• Reward points for qualifying balance transfers
• Lower interest rates

Of course, you should be aware of any balance transfer fees to ensure that credit card consolidation is worthwhile. You’ll also want to make sure that lowering your credit limit won’t throw your credit line to debt ratio too far out of whack.

You can set up a balance transfer or use balance transfer checks to consolidate your credit cards. Consider the Discover More Card or the Citi Platinum Select MasterCard, both with 0% APR on balance transfer for the first 9 months.

As you can see, these personality types were painted rather broadly. Not everyone with a low interest rate is a compulsive shopper and rewards aren’t just for fastidious deal seekers. But by taking time to realistically consider your spending habits, you’ll best be able to choose the card that will benefit you the most. After all, a low interest rate is neither here nor there to someone who pays off their balance each month and 20% cash back on online purchases is useless to brick and-mortar shoppers. Ignore the commercials and the well-meaning (but often misguided) folk wisdom of friends and family. Instead, think about how you’ll use your card before prioritizing the perks.

Photo: szlea

Tagged as: balance, card choices, credit, credit card, debt, interest rate, payoff, personality type, shopaholic