Morning Mix


MSUFCU busts common credit card myths

Posted at 10:46 AM, Mar 04, 2022
and last updated 2022-03-04 10:47:09-05

There are many misconceptions about credit cards, such as whether or not you should carry a balance, and how much you should pay on it each month.

Deidre Davis, MSUFCU Chief Marketing Officer, discusses some common credit card myths.

Myth 1: You need to carry a balance on your card in order to build credit.

This is not true. What you should know is that opening a credit card and using it wisely will help you build credit. For example, paying off your card every month will still help you build good credit. In fact, this is a good practice to keep up with as it helps you avoid paying interest on your purchases.

Additionally, when you open a credit card, a good practice is to not use more than 30% of your limit. This helps keep your spending down and keeps your monthly payment manageable.

One idea to help you spend wisely is to choose consistent expenses to use your credit card for each month, like groceries, gas, or a monthly bill, including subscription services. This will help you stick to your budget each month while building credit.

Myth 2: You only need to pay the minimum amount due each month on your bill.

Similar to the previous myth, it is encouraged to make more than the minimum payment each month so that you’re not accumulating as much interest on your purchases. If you make a purchase on your card for $100 and pay the minimum amount due, say $25, the $75 leftover will accumulate interest based on the rate of your card. This interest will then accumulate and be added to your total balance, which means you’ll end up paying more for your purchase in the long run. If you can pay off your balance each month ¾ even better!

Myth 3: Get a card that offers lots of rewards.

While rewards are important, you should also look at factors like the interest rate, annual fees, and fraud protection offered with the card. For example, a card that offers 1% cashback might sound great, but if it has an annual fee of $100, you would have to spend over $10,000 per year to make up for the annual fee and start earning cash back.

Make sure you examine all the features, benefits, and downsides to the cards you’re interested in before you open one.

From low-rate cards and cash back rewards with no annual fees to tiered cashback with higher incentives, MSUFCU offers a variety of credit card options. All of MSUFCU's credit cards feature tap to pay technology, free quarterly credit scores, and Visa Card Lock, which allows you to easily lock your credit card on the mobile app in the event it is lost or stolen. You can also unlock it just as easily if you find it again.

You can quickly and easily apply for our low-rate credit cards through the MSUFCU Mobile app or on

Sponsored by MSU Federal Credit Union