Article | September 1, 2022


Buy & Borrow

Smiling man sitting in front of laptop holding card in one hand and smartphone in the other

All credit cards offer a convenient way to pay for and manage expenses. But that doesn’t mean one card is just like another. It’s important to select the one that best aligns with your needs, credit history, and lifestyle. That starts by looking at what the card is designed to do — such as earning rewards or having a low interest rate — and who it’s designed for, such as people who are new to credit use or looking to rebuild their credit.

Here’s a review of how a credit card can be a useful financial tool, plus a review of three primary types of credit cards and the features and benefits they offer.

What are the advantages of paying with a credit card?  
“One of the best benefits of using a credit card is that it provides an opportunity to build credit for new users. For those who have established credit, it provides an extension of their purchasing power,” explains Reva Rao, Senior Vice President, Lending at Golden 1 Credit Union.

In addition, she says, “Transactionally, credit cards allow for easier returns and extra purchase protection.” Plus, when you make a purchase with a credit card, you can take advantage of an interest-free grace period — usually several weeks — before payment is due.

Credit cards that offer rewards
Credit cards that offer rewards are usually designed for people with established credit who want to get more from a card than just a way to borrow.

Example: The Golden 1 Member Cash Rewards+ card offers cash back on everyday purchases such as gas, grocery, and restaurants.1 Using this card, our members receive approximately $1.5 million cash back monthly!2

Credit cards with low interest rates
Some credit cards focus on providing a low interest rate. This can be useful if you want to consolidate higher-interest debt, if you don’t typically pay your balance off every month, or if you want to finance a larger purchase and pay it off over time.

Example: The Golden 1 Member Rate Advantage card has our lowest interest rates and higher potential credit limits. Plus, it features card and money management tools to provide added convenience and help streamline financial tasks.

Credit cards that help build credit history
Some credit cards are designed to help people with no credit history, like students and other young adults, or people who need to rebuild their credit history. These cards may be “secured,” meaning they’re backed by collateral, such as a dedicated savings account.

Demonstrating responsible spending and on-time payments with these cards could help create the foundation for a strong credit history and score, or improve a damaged credit reputation. That could lead to opportunities to enjoy better loan terms in the future for major purchases like a car or a house.

Example: The Golden 1 Member First card is secured by a deposit of up to $3,000.3 Each month, payment information is reported to the credit bureaus, helping build a positive credit history.

Other credit card features 
“Credit cards provide many other ancillary benefits to meet your needs or preferences,” says Rao. She notes the following features offered by different Golden 1 credit cards:
No annual fee or balance transfer fees4
Low interest rates
Streamlined purchasing, such as contactless payment, the ability to add the card to a mobile wallet, and secure online checkout
Enhanced security features, such as being chip-enabled or offering zero fraud liability protection5 
Card Controls app, which lets you securely, easily manage your card anywhere, anytime6 
Credit Sense, allowing you to view your credit score, credit report, and more
Travel, roadside, or emergency services7
Discounts, services, or rewards tied to local businesses or events7

Tips for managing your credit card account  
Once you’ve decided which type of credit card makes the most sense for your needs, it’s important to familiarize yourself with your cardholder agreement. For instance, make sure you’re aware of your card’s annual percentage rate (APR) for purchases, grace period, monthly due date and potential penalties for missed payments.

Keep in mind that you can usually take advantage of interest-free financing if you pay your credit card balance in full each month. Still, it’s also a good idea to have a plan to repay balances that carry over from month to month. Managing your credit card account online or with an app, and scheduling payments in advance can also make it easier to budget and keep track of your finances, including your credit card account.

We can help
Picking the right credit card — and managing it well — is part of building a strong financial foundation and helping to achieve your goals. If you want help choosing the right card for your needs or are ready to apply for a Golden 1 credit card, we can help. Call us at 1-877-GOLDEN 1, visit your local branch, or use our convenient online application.

“Student Credit Cards 101: Everything You Need to Know,” Virginia C. McGuire, NerdWallet, published Dec. 10, 2021,, accessed Jan. 6, 2022

“What is a student credit card?” Kat Tretina, Investopedia, updated July 14, 2021,, accessed Jan. 6, 2022
“How to Use Credit the Right Way,” Latoya Irby, The Balance, reviewed by Erika Rasure on Nov. 21, 2020,, accessed Sept.7, 2021

1Members earn cash rewards on net qualified purchases (less credits, returns and adjustments) for each $1 spent. No maximum limit on total cash rewards earned. Balance transfers, cash advances and cash-equivalent transactions, such as purchases of money orders or gift cards, and certain other purchases/transactions do not earn rewards. We reserve the right to determine in our sole discretion whether a particular transaction is a qualified purchase.
A 4% cash reward is offered on net qualified gas purchases at eligible gas merchants. Cash rewards on gas purchases are limited to up to $5,000 in purchases annually, then 1% thereafter. A 3% cash reward is offered on net qualified purchases from eligible restaurant and food delivery. A 3% cash reward is offered on net qualified purchases from eligible grocery stores or supermarkets. Purchases made at wholesale warehouse clubs are not eligible for rewards. All other net qualified eligible purchases will receive a 1% cash reward for each $1 spent.
2Based on January – December 2021 cash rebates.
3Dividends are paid on the funds held in the savings account. Please see our Credit Card Account Agreement for other terms and conditions.
4 Other fees apply. Cash advance fee is either $5 or 2.5% of the amount of each cash advance, whichever is greater. Foreign transaction up to 1% of each transaction in U.S. dollars.
5Golden 1 provides zero fraud liability for unauthorized transactions on your card, when promptly reported. Certain conditions and limitations may apply. See your Credit Card Account Agreement for additional information on unauthorized use.
6Message and data rates may apply. Check with your provider.
7Certain conditions and limitations apply. See your benefits disclosure for details.

All third-party companies, products and service names used are for identification purposes only. All service marks, trademarks and registered trademarks are the property of their respective owners.