MONEY credit cards

These Credit Cards Have the Best Perks

credit card with door cut out and red carpet
Yasu+Junko

Take advantage of lesser-known credit cards, and you'll feel like a VIP.

The full value of a credit card in your pocket can go far beyond the usual cash back and reward points. Rental-car insurance, free credit scores, and other freebies are there for the taking—as long as you know where to look.

Not everyone does, however. Jim Miller, J.D. Power’s senior director of banking, estimates that one-third of credit card users don’t know the benefits that come with their cards.

To make sure you’re not overlooking extras perhaps worth hundreds in all, read the disclosures on your issuer’s website to see what you’re due. Although you might not want to switch cards just for the perks, if you are in the market for a new card with better terms, why not pick one that gives you a little more? Here are some standouts.

CREDIT

THE PERK: Free credit information. The standard price to see your FICO credit score is $20 for a peek that’s bundled with a credit report from one of the three major credit bureaus. But issuers such as Citibank and Barclaycard will pass along your FICO score from one of the big three for free. “The giveaways are great,” says John Ulzheimer of CreditSesame.com.

MONEY PICK: Discover it. Like other Discover cards, this one—which MONEY named the best online-shopping card last year for its discounts—reports your FICO score from TransUnion. The card’s new Freeze It feature also lets you temporarily block one-time charges. So if your card is missing and you’re pretty sure it hasn’t been stolen, your Netflix autopay will go through, but no one will be able to use your plastic at Best Buy.

SHOPPING

THE PERK: Price protection. Say you buy something only to see its price drop within a few weeks. Some credit cards will return the difference. Electronics are most likely to qualify, says Ben Woolsey of CreditCardForum.com. Cars, event tickets, and jewelry usually aren’t covered.

MONEY PICK: Citi DoubleCash. A MONEY pick for best flat-rate rewards card, DoubleCash, like other Citi cards, features Price Rewind, a program that refunds up to $300 per purchase and $1,200 per year. Citi, unlike other issuers, doesn’t make you find the falling prices. Instead, Citi does the price checks for purchases you register. The average refund is now $35.

THE PERK: Free fast shipping. American Express cardholders get free use of Shop Runner, a $79-a-year service offering two-day shipping from over 100 online retailers. Stores include Lord & Taylor, Toys “R” Us, AutoZone, and drugstore.com (but not Amazon.com).

MONEY PICK: American Express Blue Cash Preferred MONEY’s top card for cash back on essential purchases returns 6% of your annual grocery spending, up to $6,000, and 3% at the pump. A $150 sign-up bonus for spending $1,000 within three months makes up for the $75 yearly fee.

TRAVEL

THE PERK: Primary rental-car insurance. While your card may offer insurance on rental cars, chances are it’s secondary to your own insurance: If your rental is totaled, your policy takes the hit. Some cards, though, don’t make you go through your regular insurer first, thus protecting your rates, says NerdWallet.com’s Kevin Yuann.

MONEY PICK: Chase Sapphire Preferred Pay for your rental with this card (MONEY’s best card for mileage hounds) and decline the rental company’s collision (or loss) damage waiver. You’ll be eligible for reimbursement up to the actual cash value of the car in case of a collision or theft. A caveat: Some exotic cars aren’t covered.

THE PERK: Less-stress travel. From planning your trip to keeping track of your flights, travel is a recipe for high blood pressure. Cards that enrich your trip and protect you from some of flying’s hassles (see chart below) can be the cure.

MONEY PICK: Barclaycard Arrival Plus World Elite Master-Card This card gives you free use of the travel organization app TripIt Pro ($49 annually), which automatically creates your itinerary, sends real-time flight alerts, and can locate alternate flights. You also get access to a no-fee personal travel planner and discounts on hotels and events. The downside: an $89 annual fee, waived the first year.

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MONEY credit cards

Citibank Must Pay $700 Million to Consumers for Illegal Credit Card Practices

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Bloomberg—Bloomberg via Getty Images

If you have a Citi card, you might be owed some cash.

The Consumer Financial Protection Bureau ordered Citibank Tuesday to reimburse about 9 million consumers for deceptive marketing and incorrect charges associated with credit card add-on services.

These holders of Citi cards—or those of a Citi subsidiary that issues store-brand cards for Macy’s and Bloomingdale’s—were victims of misleading sales tactics, the CFPB alleges. In many cases, confusing text on credit card applications got consumers to sign up for extra debt-protection services they didn’t necessarily want to pay for.

In some cases, says the CFPB, Citi charged customers for benefits, like credit monitoring, that they weren’t actually receiving. The company also implied to many customers that they were protected from fraud and identity theft, when, in fact, they were not, says the Bureau.

If you signed up for a Citi card between 2003 and 2012, there’s a chance you are eligible for money back.

“We continue to uncover illegal credit card add-on practices that are costing unknowing consumers millions of dollars,” CFPB Director Richard Cordray said in a statement Tuesday.

Any affected customers will automatically receive a statement credit or check, according to Citibank. And if you used to have a Citi card but no longer do, you still might be eligible for reimbursement; Citi says it will mail you a check in that case.

“Citi cooperated fully with the CFPB … and has taken extensive steps to address each issue that affected customers,” Citibank said in a press release.

In addition to $700 million in refunds to customers, the CFPB is demanding Citi pay a $35 million fee to the CFPB’s Civil Penalty Fund.

MONEY credit cards

The 5 Most Common Credit Score Killers

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Tetra Images—Getty Images

A single late payment can lower your score by as much as 100 points.

Having a good credit score can help you save a lot of money over your lifetime, but many people find themselves with scores lower than they’d like because they don’t know how much everyday things can hurt their scores.

Of course, once you know what those things are, you’re better equipped to improve your credit. Here are five common things that can hurt your credit:

1. High Credit Card Balances

One of the most influential factors in credit scoring is your revolving credit balances relative to your credit limit. You may be able to afford to spend much or all of your available credit and pay the bills in full, but that doesn’t mean you should.

The ratio of your credit card balance to the card’s limit is called credit utilization — it’s calculated for each revolving credit account you have, as well as your total balances relative to your total amount of available credit. (Installment loans factor into credit utilization, too, but revolving credit has a greater impact.)

On average, Americans use 24% of their available credit, which isn’t a bad place to be, but the lower you can get that credit utilization rate, the better. If you have low credit card limits and want to use your cards for a lot of purchases, consider paying your bill more frequently so the balance doesn’t creep up.

2. Late Payments

This is even more important than keeping your debt levels low. In fact, the most important thing you can do for your credit is make your credit card and loan payments on time. (Missing other bills, like for utilities, generally isn’t reported to the credit bureaus, but unpaid accounts could be sent to a debt collector, and collection accounts hurt your credit.)

A single missed payment could knock dozens of points — even 100 points — off your score, so pay close attention to due dates.

3. Applying for a Bunch of Credit Cards at Once

When you apply for a credit card or a loan, the potential creditor will want to see what your credit looks like. Credit checks for the purpose of extending credit are considered hard inquiries (a soft inquiry occurs during something like an account review, employer credit check or when you check your own credit), and hard inquiries will knock a few points off your score. If you apply for many credit cards in a short period of time, those little dings add up to a big dent in your score, but applying for loans is a bit different, since scoring models group those inquiries together so as not to penalize you for shopping around. You can read here about how applying for loans affects your credit scores here.

4. Closing Credit Cards

It may seem strange to keep open an account you don’t use, but it can make sense from a credit score perspective. Even if you don’t use a credit card anymore, keeping it open can help improve your credit utilization rate. As soon as that account is closed, you lose that available credit, so you would need to reduce the amount of spending you do on credit cards to keep your utilization from increasing.

If a credit card is one of your older credit accounts, you would want to keep it open for the sake of keeping up your average age of credit, because that’s something that takes a long time to build up. Having an average credit age lower than seven years can suppress your score.

5. Identity Theft

You may not be able to prevent it, but the longer identity theft goes unchecked, the higher the chances it will hurt your credit score. A fraudster may open up accounts in your name or run up a huge balance on a stolen credit card, and if you don’t stop it before the activity is shared with the credit bureaus, you’ll also have to deal with getting that information off your credit reports. Identity theft is extremely common, so the best thing you can do is monitor your financial accounts closely and act quickly to cut off a fraudster as soon as you notice anything suspicious.

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MONEY financial advice

Financial Website Brothers Share Their Best Financial Advice

BrightScope co-founders Mike and Ryan Alfred talk about retirement savings and their biggest money mistakes.

Save until it hurts was the first thing Mike Alfred, a co-founder of BrightScope, said about retirement savings, and that’s part of his best financial advice to give others as well. “Live below your means,” he said, “which sounds very simple in theory but it much more difficult in practice.” His brother Ryan, the other BrightScope co-founder, suggests keeping your investments at arms-length so you’re not tempted to overanalyze them.

Mike said his biggest mistake was buying in to the dot-com bubble, while Ryan talks about how they funded a large part of their business on their own credit cards.

Read next: The Co-founders of BrightScope Share The Painful Secret to Retirement Success

MONEY Travel

Tricks for Making Travel Cheaper

Travel + Leisure's Jacqueline Gifford shares tips for traveling well...for less.

Getting a great deal on a summer vacation doesn’t have to be difficult, and there are several things you can do to bring down your holiday cost.

Try a low-cost airline. Airlines like Norwegian Air and Wow Air offer cheap flights abroad.

Take a layover. It might take longer, but the price often beats a nonstop flight.

Be flexible. Certain days of the week are cheaper than others.

Travel in the off-peak season. Figure out when the shoulder seasons or low seasons are for your destinations, and try to go then.

Get a credit card with no international fees. You don’t want to get home and find out you were slammed with a lot of foreign transaction fees. Check out our Best Credit Cards.

Bundle. It’s often cheaper to bundle airfare and hotel together through an online travel agency.

 

MONEY Budgeting

8 Ways to Simplify Your Finances

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Marc Romanelli—Getty Images

Consolidate. Prioritize. Automate.

Do you find yourself overwhelmed by your financial responsibilities? Do you sometimes ignore your accounts and budget because thinking about them adds stress or confusion? Understanding the steps for good financial decision-making and simplifying your role can help you take control of your finances. Check out the following tips to create an easier structure in your finances and watch how each small change adds up.

1. Pare Down Your Accounts

You probably don’t really need more than one savings or checking account or to have accounts with many different financial institutions. One method to simplify your financial life is to consolidate your bank accounts to one checking account and one savings account to cut down on the paperwork and tracking.

2. Prioritize

Picture your future and choose a few financial goals to focus on at a time, like boosting your 401(k) or growing an ample emergency fund. It’s important to be specific about the goals you want to accomplish and plan the clear steps you need to take to reach them. Writing your goals down can help you stick to them.

3. Consolidate Insurance

Just as you probably don’t need multiple bank accounts that serve the same purpose, you probably don’t need multiple insurance accounts. You can save money and stress by bundling your assets that need insurance and consolidating your policies. You can compare the various companies to see who will help you save the most in this process.

4. Keep Track of Your Comprehensive Budget

When you are ready to get control of your financial life, it’s important to make sure you are living within your means. It is important not just to create a realistic, comprehensive budget but to take the steps to stick to that budget. Once you start tracking where you money is going, you may be surprised by how much you are spending in each category and how your money can be put to better use.

5. Pool Your Plastic

If you have debt, you may want to consider transferring the balances on high-interest credit cards to a credit card with a lower rate. This will help cut down on your money management and save you some money on interest. It’s important to inquire about balance-transfer fees and factor that into your decision.

To get a good balance transfer offer, you’ll need a decent credit score.

6. Go Paperless

You only need to keep important papers, so go through what you have and shred whatever you don’t need. Then streamline your future financial records by going paperless. Most companies and banks offer this feature and this can cut down on your clutter and filing. Call to set up paperless statements or bills and keep folders on your computer to help you track where your money is coming and going.

7. Automate Good Habits

If you can’t trust yourself to follow through on positive financial behaviors, consider not giving yourself the option. Set up direct deposits and contributions so you can watch your financial goals come into grasp without having to be proactive about it. If you never see the money sitting in your account, you can’t spend it.

8. Inventory Your Stuff

Take stock of everything you own, from clothes to furniture. You will find that you probably have more than you need and even things you have forgotten about. You can sell or donate what you don’t need and watch your financial clutter decrease with your life clutter.

The easier your financial management is, the more likely you are to stay on top of it and be in better fiscal health. Use the tips above and search for your own shortcuts to make this strategy a reality and watch your assets grow.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

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MONEY credit cards

3 Ways to Strengthen Your Weak or Nonexistent Credit

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Niklas Bernstone—Getty Images

Here's how to build a strong score.

Credit history a little on the feeble side?

If you’re new to credit, you might not have enough of a history to get the great deals that you want. Or even generate a score.

Here are three strategies to build a history and a strong score:

1. Consider a “credit builder” loan. Think of it as vitamins for your credit score. You borrow a small amount — often anywhere from a few hundred dollars up to $1,000 — from your credit union or bank. As you make payments, you create a record of good credit, says Michelle Dosher, spokeswoman for the Credit Union National Association.

Some versions may require a chunk of (refundable) money as collateral, while others won’t, says Jim Simon, senior vice president and chief lending officer for TCM Bank N.A.

To compile enough of a credit history to generate a FICO score, the score used by the majority of lenders, requires a six-month loan history, says Ethan Dornhelm, senior principal scientist at FICO. With the VantageScore, you’ll have a credit score after one month, says Jim Akin, senior manager of digital communications for VantageScore Solutions.

2. Get a “starter” credit card. Some institutions, especially credit unions and community banks, offer cards specifically for people who are so new to credit that they don’t have a score, says Simon.

Credit lines are lower, often $500 to $1,500, he says, and interest rates are higher, frequently between 18 to 27 percent.

The good news: A credit card will likely help you build a higher score than a loan. Both the FICO and VantageScore formulas prefer revolving credit such as credit cards to installment loans (auto loans or personal loans), according to representatives with both companies.

The bad news: If you want to build the best scores, you need to keep your balance as low as possible. The best scores go to those who use less than 10 percent of their credit limits, says Dornhelm.

The wisest choice is to use the card, keep balances low and pay it off in full each month.

One option that keeps credit utilization low is to pay off balances as you use the card, sending in your payments multiple times throughout the month, says Barry Paperno, who writes the weekly “Speaking of Credit” column for CreditCards.com and is a former credit bureau industry executive.

3. Opt for a secured card. If you can’t get a conventional card with a small credit line, this option lets you give the lending institution a deposit that could be as much as your credit limit. You still pay the bills each month, as you would with a regular credit card. And when you close the card or convert it to a traditional credit card, you get back your deposit (provided you don’t owe anything on the card, of course).

If you’re shopping for a secured card, do your research to be certain you’re getting a legitimate credit card, not a product designed to maximize fees, says Simon. At the most, you should pay a deposit and possibly an annual fee, “and that’s it,” he says.

Also understand exactly how and when you’ll get back that deposit, he says.

If you’re looking to strengthen your credit history, make sure the card actually reports to the credit bureaus every month. That’s what will enhance your history enough to generate a score.

Comparison shop for a card that has the fewest fees and the lowest charges on the fees it has, says Simon. Prioritize fees over a low APR, since if you don’t carry a balance, you won’t have to pay interest, he says.

What you might not know: Neither the FICO formula nor the VantageScore formula differentiates between secured and unsecured credit cards, according to execs with both companies. As long as you treat your cards right, your score will benefit equally from either one.

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MONEY Debt

Living Out of a Suitcase Was The Best Thing for My Family’s Finances

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Richard Drury—Getty Images

Friends were shocked when we told them we were selling everything and moving from one country to the next, but we wouldn’t have it any other way.

The year was 2013, and by all outward appearances, my husband, William, and I were living the good life in St. Louis.

He was finishing up his MBA and had an internship at a well-known consumer-products company that was sure to put him on the corporate fast track—all while running his own successful tutoring and test-prep business on the side.

I was juggling getting my Ph.D. in reproductive epidemiology while also being a mom to our pride and joy, Desmond, then 2.

But during William’s last semester in the MBA program, our family took a life-altering trip to Spain as part of his study abroad offering. What was just supposed to be a three-month trip overseas turned into two years … and counting.

Since then, we’ve lived and worked in five different countries, from Hungary to Peru—and have even added to our brood along the way.

Our nomadic lifestyle may seem a bit unorthodox to some—family and friends were shocked when we told them we were selling all of our belongings to pack up and ship out—but we wouldn’t have it any other way.

The best part? It’s done wonders for our finances.

Truth be told, the career and life paths we’d always envisioned for ourselves weren’t quite panning out.

Despite the fact that most business students would have killed to have William’s internship, he was disillusioned by corporate life.

The monotony of his day-to-day routine coupled with having to work for someone else, just didn’t feel natural to him. He wanted something more.

I was feeling a similar dissatisfaction. I’d been working on my Ph.D. for almost five years, and continuing my research while caring for a little one left me struggling to maintain motivation. I was gradually falling out of love with academia.

All of this prompted William to pose a question before we embarked for Spain for his study abroad program: What if we didn’t come back to the states at semester’s end?

What if we stayed in Europe for a few more months—one last hurrah before putting down roots?

I thought he was crazy.

We had a toddler and a mountain of debt—more than $100,000 in student loans between us, a $25,000 business loan, and about $6,000 of credit card debt. We couldn’t go gallivanting around Europe like carefree college students.

But when I saw he was dead serious, it stirred something in me. I couldn’t help but feel like maybe this could be an amazing adventure for our little family.

So we got out of our lease, moved our stuff into storage, and found an apartment in Barcelona through Airbnb for $1,200 a month—not supercheap, but still less than the $1,500 we were spending to rent a home in St. Louis.

Once we settled in Spain, William had yet another crazy idea: What if we never went back and instead built out his tutoring business overseas?

We had both been employees of the company back when we lived in Salt Lake City, and when the opportunity arose, the entrepreneur in him decided to take out a business loan to buy the company from its previous owners.

When we moved to St. Louis for his MBA program, William continued to manage the business remotely, hiring two codirectors to oversee the roughly 15 tutors we employed back in Salt Lake City. He drew a salary of about $35,000—but being abroad made us realize there was an even greater opportunity to make money.

William could meet with international schools throughout Europe and pitch them our services, in which one of our tutors would spend a few weeks doing SAT/ACT prep at their schools to help students who wanted to attend college in the U.S.

I believed in the plan, but the thought of living in—not just visiting—so many different countries terrified me. But if we were going to try this, it was now or never.

So I put my Ph.D. on hold and became our family’s Chief Travel Officer.

5 Countries, $300 Rent, $0 Credit Card Debt

We stayed in Barcelona for about five months, taking in the culture, loving every minute—and mapping out our next destinations based on whether there were international schools close by, our interest in the region, and the cost of living.

Our next, three-month stop was Budapest, Hungary, which was a much cheaper place to live. By avoiding renting in a tourist area, we were able to get a great apartment for just $300 a month.

It was then that I realized how living abroad could actually be good for our finances because, if we planned well, life could be so much cheaper.

When the holidays rolled around, we headed back to St. Louis to sell all of our personal belongings and officially leave our U.S. life behind. But, first, we made a pit stop in Rome—which is when we discovered that our second baby was on the way!

Giving birth in a safe place where I felt comfortable, was important to me, which is why we chose to live next in Colombia. I was born there and still had family there, so it was comforting to know we’d have some support.

After finding a fully furnished apartment in Bogota for $900, we headed out there in February 2014—and welcomed our second son (named Roman, in a nod to Italy) in the spring.

We didn’t have international health insurance at the time, so we paid out of pocket for the birth, which only added up to $1,800, including all of my prenatal visits. Since then, we’ve gotten family coverage for just $200 a month.

In the eight months that we were in Bogota, William took countless meetings, nabbing new contracts and growing the business even more. He gradually increased his salary to about $45,000 a year, and the company helps subsidize such expenses as flights for business meetings, as well as our rent. I also brought in occasional income by doing some freelance research and public-health data analysis on the side.

While we don’t get a tax break from living abroad—we still have to file U.S. income taxes—we do get some tax write-offs for any business-travel-related expenses we have to cover.

This new life has allowed us to get our $6,000 credit card balance down to zero last year—and pay off our $25,000 business loan.

And while chipping away at our student loans will be a slower endeavor, we’ve been able to contribute to a 529 college savings account for Desmond, open a trust account for Roman, and maintain an emergency savings fund of about $2,000.

Our next goal will be to resume contributions to a Roth IRA, which we’d put on hold during graduate school.

Living frugally, of course, helps a lot. For starters, we always opt for cheap housing, even if it means choosing less-prime neighborhoods. Our rent abroad—including furnishings, WiFi and utilities—has averaged $1,000, which is about $500 less than what we were paying in St. Louis.

But, without a doubt, our biggest savings has come from no longer having to pay for gas, insurance and repairs for two cars—we quickly familiarize ourselves with public transportation in every new city. I also do a lot of cooking at home, using seasonal and local ingredients as much as I can, to save money.

In cities where the cost of living is higher, we keep stricter tabs on our expenses, so we know when we’re close to going beyond our budget. Plus, living out of suitcases means we can’t accumulate much stuff—so no extravagant shopping sprees for us!

These frugal habits have accompanied us in the five countries we’ve lived in—Spain, Hungary, Colombia, Peru and Mexico—and the dozens of places we’ve visited. We’re currently back in Bogota, but it’s off to Japan next to build an East Asian client base.

The Intangible Perks of Our International Life

One of my initial concerns with living abroad was how the kids would adjust, but they’ve taken to the nomadic life with ease.

Desmond has attended four different preschools, and in just a few short months, we’ll enroll him in an all-Japanese kindergarten. Once he gets to first or second grade, we plan to home-school because we know international schools can get very pricey.

In our opinion, these experiences have helped shape Desmond into an outgoing, fearless kid—not to mention that he now speaks Spanish fluently!

People ask how long we plan to keep up our gypsy lifestyle. The honest answer: I’m not sure. There are times when I think I’d love to own a permanent home, but then I look around and realize that we’re living most people’s once-in-a-lifetimes.

We’ve spent the past few years marveling at Machu Picchu, taking overnight train rides through Transylvania, and braving the outdoor markets of Santiago.

We may not be millionaires, but we also aren’t struggling. When we started this journey, the company had one international class. We have 11 classes starting this fall, and even more in the works for the spring semester—which has more than doubled our profits.

Over the last few years, my most fulfilling memories have been watching my children play with kids who speak different languages and hold different beliefs. I’ve also come to realize that the best memories happen when you’re willing to surrender a little control and embrace the unexpected.

At the very least, what our nomadic life has taught us is that when we finally do settle down, we won’t need a great, big house with a fancy car to be happy. I’ve learned that you don’t need to have a permanent address to feel like you have a home.

–As told to Maryanne Hayes


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MONEY credit cards

You May Have a Second Credit Report You Never Knew Existed

Darryl Estrine

It's rare, but it happens.

Credit reports often feel like a mystery, particularly if you haven’t seen yours. But what if you discovered you had a second credit report you didn’t know existed?

“It’s a pretty rare thing,” says Carla Blair-Gamblian, director of credit education for Veterans United. But every once in a while she’s seen situations where a client ended up with two credit files at the same credit bureau.

Referred to sometimes as “split files,” “fragmented files” or even “phantom files,” part of your credit history ends up on one report and part of it is on another, usually “hidden” file. Blair-Gamblian says that she’s seen only three or four cases of it in the past six or seven years, but they were always women. She speculates that a name change along with an address change may cause the mix-up — especially if a Social Security number is entered incorrectly.

“Back in the days of the manual credit files, we would see it pretty frequently,” says Connecticut bankruptcy attorney Gene Melchionne, who worked for a credit bureau before files were computerized and files may have included arcane details such as the color of your wedding dress. “Usually it was the result of someone using multiple Social Security numbers or birthdates so we wouldn’t be able to match the credit inquiries completely,” he says.

How do you know if your credit report has a doppelganger? One major tip-off is when accounts from major lenders appear on one or two of your credit reports but not all three.

“It is certainly possible that you have a creditor that doesn’t report to all three bureaus so maybe you shouldn’t be alarmed, especially if it’s a smaller regional lender,” says Blair-Gamblian. But if you have major creditors that report to all three bureaus — Experian, TransUnion & Equifax — there is no reason that they shouldn’t appear on all three of your credit reports.

If a split file does occur, it can be difficult to straighten out. After all, how do you request a credit report that the credit reporting agency says doesn’t exist? You may have to escalate a complaint with them and mention specifically that you believe there may be two files.

Thankfully, most consumers will never have to deal with this problem. “I haven’t seen anything like a split file since the dawn of computers,” say Melchionne. “In fact, quite the opposite is more likely; files that have been combined due to similar information. When I bought my first house, I was told that my credit at the bank had been confused with my father’s and that I paid a mortgage off when I was 12. ”

To prevent problems such as a split file or mixed file, always be sure to use complete and consistent information when filling out a credit application, especially if you are a junior or senior or have a common name. And to ensure your credit reports are accurate and complete, you need to check them. You can get free annual credit reports at AnnualCreditReport.com.

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MONEY

These Credit Cards Will Hit You With the Most Fees

person pulling credit card from wallet
iStock

Plus, how to avoid other penalties that will cost you money.

Credit cards are powerful tools. There are products that let you earn a free flight; collect cash back on all purchases at a time when interest rates rest at next to nothing; or finance a big expense with a lengthy 0% APR introductory period.

But the advantages credit cards offer come at a price—in some cases, an abundance of fees. That’s why consumers need to be vigilant when it comes to selecting the credit card that’s right for their spending needs and behaviors.

That means steering clear of cards like First Premier Bank Credit Card and its Secured MasterCard, which have the potential to ding consumers for 12 separate fees, according to a CreditCards.com survey released today, based on the 100 credit cards used to calculate the site’s Weekly Rate Report. First Premier Bank Credit Card even charges you 25% of whatever increase you receive on your credit limit. Only one product in the survey was completely fee free: PenFed Promise Visa.

“This drives home just how much difference there can be between cards,” says CreditCards.com senior analyst Matt Schulz. “Banks make tons of money off fees, and the vast majority of them can be avoided by shopping around and setting up automatic payments to ensure that you don’t miss a payment.”

Credit card penalties generally fall into two categories: fees based on your actions and fees imposed by the card, such as annual or foreign transaction fees.

Almost all cards penalize you for behavioral mistakes. For instance, CreditCards.com found that all but one card assess a late fee, usually $35. More than eight in 10 will hit you for another $35 for returned payments, i.e. a bounced check. And all but two of the cards charged consumers a cash advance fee, which runs the greater of 5% of the advance or $10.

You can avoid late fees by paying your bill on time. Try setting up auto-payment on your credit card’s website if you’re bad with dates. Just because you’ve erred in the past doesn’t mean that you’re without recourse. In an earlier poll, CreditCards.com found that 86% of those who asked to have a late payment waived were successful in avoiding the fee. The problem is that only 28% of folks requested extra latitude. As more banks adopt instant messaging on their sites, cardholders shouldn’t be shy to ask for a fee to be canceled if they slip up once in a blue moon.

While you can eliminate a number of fees by staying on top of your finances, you’ll need to do some smart shopping to avoid others. Annual fees are relatively easy to shed: only 25% of cards have them, and 10% waive the fee the first year. (In some cases an annual fee is acceptable if the rewards are rich enough.) Nine of 10 cards that allow balance transfers charge a fee (the greater of either $5 or 3% of each transfer), but some, like MONEY Best Credit Card Chase Slate, won’t charge you anything. (You’ll need to make your transfer within two months of opening your Slate account to avoid the fee.)

Check out MONEY’s Credit Card Matchmaker to find a card that best fits your borrowing profile.

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