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Credit cards that can get you through the crisis
Put credit card interest on hold and focus on the essentials.
As the coronavirus spreads throughout the Canada and businesses temporarily shutter, it can be very difficult to keep up with finances. If you’re among those facing mild to severe financial difficulties, know that you are not alone and that you have options. Here are some ways you can keep your finances stable with credit cards during these uncertain times.
Riding out a lack of income
Service industries have been hit particularly hard during this outbreak, with several provinces temporarily closing bars, restaurants and similar businesses. If you’re a service worker affected by these closings, you’ll need to float your finances for at least a few weeks until you can return to your job. There are a few helpful tools to consider: 0% intro APR credit cards for purchases, instant approval cards and cards for fair credit.
Intro purchase APR credit cards
A credit card with an intro period on purchases can let you use your card on spending without needing to pay interest for a set period of time. Since we’re unsure how long these business closures will last, you’ll want a card with as long an intro period as possible.
On average, these cards will stave off interest for 6-9 months, though some can go even longer.
Instant approval credit cards
You might find that you need a credit card faster than the 7 to 10 business days it typically takes to receive one upon approval. If so, there are a few banks that will give you your card’s account information upon approval.
Once approved, you can copy your card information and use it to make digital and online purchases right away.
Easy-to-obtain credit cards for fair credit
Not everyone will have equal access to the full range of credit cards out there. If you don’t have a credit score or have a history of poor to fair credit, consider a credit card designed for that credit range.
Compared to high-end cards, it’s relatively easy to obtain cards for fair credit. While you won’t necessarily get the best rates or rewards with these cards, they’re still a step above credit cards designed for poor credit.
Keep in mind that credit cards for poor and fair credit will have lower credit limits than cards for good and excellent credit. In some cases, it might not be worth applying for these cards if your spending is going to far outstrip your given credit limit.
Are secured credit cards helpful during an emergency?
No. Secured cards won’t keep you afloat financially since they require a security deposit which acts as the card’s credit limit.
I can pay for the essentials, but can’t cover my credit card bills
If making rent and grocery payments isn’t a problem, but you don’t think you can make your outstanding credit card payments, a credit card can help here too. Specifically, you’ll want to look at available balance transfer cards.
Intro balance transfer APR credit cards
With a balance transfer card, you can move your existing card debt over to a card that doesn’t charge interest for a set period of time. This means you can move your existing card payments off the table while you focus on taking care of yourself.
Intro periods on balance transfer cards average around 6-9 months, but some can go even longer.
Mind your intro period
For balance transfer and purchase intro APRs, do your best to pay off your entire balance before that promotional period ends. Otherwise, you’ll be hit with retroactive interest on your balance which could put you in bad financial shape down the road.
To avoid overspending and not being able to pay off your balance, use your card only for absolute essentials.
How do I choose a card?
Given the uncertain nature of the coronavirus response, we recommend erring on the side of caution and prioritizing a card with the longest intro APR period on purchases or balance transfers.
If your primary concern is stabilizing your finances now, factors such as card rewards and perks may not weigh into your decision as heavily. Also note that you aren’t obligated to use the card after your intro period ends, so it might be helpful to choose a card without an annual fee to avoid increasing your financial burden.
Compare credit cards with introductory APRs
The right credit card can serve as a useful crutch as you deal with the short term effects of coronavirus on our economy. Using a credit card this way isn’t sustainable over the long term however, and you’ll eventually need to pay down your balance. Take care to use your emergency credit card wisely and don’t fall behind on payments.
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