A Good Offer? And the Tuna Says...

Oh great Card Tuna, swami of credit cards. I have a dilemma and don't know what to do, can you help me?

Today, I received a mailing from Pentagon Federal Credit Union. Inside, it had a great offer for credit card. At least I thought so. But I'm so confused about credit card rewards, that I'm not sure what to do.

So here's what they're offering me, oh great tuna, and I ask you what should I do?

It's a Visa platinum cash rewards credit card, which has historically given you 5% cash back for gas paid at the pump. It's also had 1.25% cashback for all other purchases. And those cashback bonuses are paid on a monthly basis to PenFed members. The new twist on the offer is that it now includes 2% cashback on supermarket purchases. Again, awards are paid monthly.

The interest-rate offers sound pretty good as well. Balance transfers get a 5.99% APR for the life of the transfer. The current interest rate for the credit card is a 13.99% APR. While I know that's not the greatest rate, since I pay my balance in full each and every month -- as you preach, oh great tuna -- I'm not worried too much about that rate.

So, what do you think? Deal, or no deal?

Increasing Your Credit Line by Doing Nothing at All!

How do you increase your line of credit with an existing card?  The obvious solution is to simply ask the bank to extend the credit limit.  And that works, as long as your payment history is good, have a good FICO score, etc.

However, another way of getting more credit is to just do nothing.  On Dec 31st, for example, I got the word from Bank of America that they were increasing my credit limit to $23,500 from $20,000 on a platinum MasterCard that I've had with them since 1988.

The back story is that I've not been happy with BofA for a while now.  They have been slowly jacking up my rates, even though I've been a long-term customer.  (Although not a "good" customer, as I pay my bill in full every month.)  So I stopped using the card back in September and switched over to an Advanta credit card, which had a much better rate, should I ever need to revolve a balance.

Turns out that BofA quickly noticed I wasn't using their product and they weren't even collecting interchange on me.  So they thought that by increasing my credit limit and sending me a bunch of checks (with a 1.9% balance transfer rate--whew, what a lousy offer!) that I'd mend my ways and come back to Bank of America.  Well, I probably won't go back to using their MasterCard, but I do appreciate the larger line of credit.  You never know when you might need some short-term credit to tide you over.