Cash Accounts and High Interest Accounts for 2019

SoFi Money and Wealthfront Cash

The Current APY is 2.1% to 2.5%. If you are not earning over 2% APY in 2019 on your cash you are leaving money on the table.

For every $10,000 you have in the bank you will make $250/year at 2.5% APY.

Best Account for Features

SoFi Money – 2.25% APY

This account has all the features of a checking account with the interest of a savings account. If you are looking for one account to do everything, this is the one.

Get $50 for signing up here:

  • Unlimited Withdrawals/Deposits
  • FDIC Insurance up to $1.5 Million
  • Debit Card with ATM Fee Reimbursement
  • Mobile App with Check Deposits
  • Free Bill Pay with Mailed Checks
  • Supports Direct Deposits

Best Account for Interest

Wealthfront Cash – 2.57% APY

This account is more like a savings account, except up to $1 million in FDIC insurance and unlimited transfers. As of writing this it is the highest APY account with no strings attached.

  • Unlimited Withdrawals/Deposits
  • FDIC Insurance up to $1 Million

Get your first $5,000 managed for free with through this referral link:
(or just use the referral link to support the blog and server administrators).

List of High Interest Accounts

This is a third party list of high interest accounts. The list at the top contains what seems to be no-strings attached free accounts. Try these at your own risk:

More About Cash Accounts

You are probably familiar with a traditional bank account. Its an account held at a bank and usually has FDIC insurance up to $250,000 per depositor. Additionally you get all the features and services offered by your bank such as debit card, checks, bill pay, direct deposit, etc. Additionally they may offer savings accounts with higher interest rates but limited withdrawals and services.

Both SoFi Money and Wealthfront Cash are not bank accounts. They are also not banks. For the most part they work like a bank and you probably wont be able to tell the difference in SoFi and any other online bank account without looking under the hood. These Cash Accounts are also known as Sweep Accounts.

These are the key things to note with a Cash Account vs a Traditional Bank Account.

  • Your money is stored in multiple banks. This provides FDIC insurance up to 250,000 times the number of banks used. So if your institution used 4 partner banks, you could effectively get up to 1 million in FDIC insurance.
  • Your money is not instantly FDIC insured. The money must be transferred from your Cash Account into the partner banks accounts before it is FDIC insured. This means that new deposits may be without FDIC insurance for a few days.

Conclusion and Which to Choose

Picking the right account depends on your needs and preferences. SoFi is loaded with features and will probably fulfill all your needs. Wealthfront does not have near as many features as SoFi but has slightly better interest. These accounts are absolutely free with no fees or strings attached so there is no reason not to get both.

If you want to keep things simple, use SoFi as your checking account and use Wealthfront as your savings account. SoFi has all the feature of a checking account and Wealthfront has the best interest available today.

High Interest Checking and Savings for 2018

You are probably not getting the most out of your savings account and checking account when it comes to interest. Current rates for Savings accounts is about 2% APY. See below for more about APY and how much it adds up too.

Savings Account

With a savings account, having a brick and mortar location is usually not required. This is why I strongly recommend you move your cash savings over to a high-yield savings account.  At the time of writing this the highest return with no strings attached is 2.05% APY.

Bank5 Connect – 2.05% APY

  • Minimum to Open: N/A
  • Minimum Balance: $100.00 (to earn interest)
  • Maximum Balance: N/A
  • Checking Offer at 0.76% APY (see below)

Salem Five Direct – 2.05% APY

  • Minimum to Open: $100
  • Minimum Balance: N/A
  • Maximum Balance: $1,000,000
  • Checking Offer at 0.25% APY

Checking Account

If you are looking for a high-yield checking account and don’t need a brick and mortar bank (or want to use it along with a brick and mortar bank) then there are quite a few offers, many of which you need to beware of.

Most banks that offer high-yield checking account come with the requirement of X debit card transactions (as credit) every month. While some debit cards come with cash back and you can get up to 5% APY on the first 2-5 thousand in your checking account, it will never come close to what you can get by using your cash back credit card over your debit card.

That being said, you can currently get up to 0.76% APY on your checking with no strings attached. I have only found one good high-yield checking account.

Bank5 Connect – 0.76% APY

  • Minimum to Open: N/A
  • Minimum Balance: $100.00 (to earn interest)
  • Maximum Balance: N/A

What Does APY Mean To Me

APY – Annual Percentage Yeild. This is how much you earn on your money for the year. This is usually computed daily on your daily ending balance for the account and typically paid out monthly (each statement).

Percent – Most importantly how to easily calculate it. You just move the decimal to the left 2 places and then multiply. So to get 1% of 100 you would multiply 0.01 by 100 and get 1.

Savings Example – $10,000

If you have $10,000 in a savings account at 2.05% APY compounded yearly you would have made $205 at the end of the year. If you calculate your interest daily as they do you divide 2.05 by 365 days in the year and you get about 0.0056. Then 10,000 divided by 0.000056 equals about $0.56 cents a day.

Checking Example – $1,000 daily balance

If your average daily closing balance in your checking account is $1,000 and at 0.76% APY you would have made about $7.60 at the end of the year. This is not much if you keep less than $1,000 in your checking account but if you need to keep 3-5k it can start to add up.

Alternatively, you can get $300 to open a new Chase checking account if you have direct deposit right now; however, that is a one time offer and requires work on your end to update banks and direct deposit, then update them again if you decide to leave chase. So if your goal is to make the most money there are other offers available; however, if you just want to make a few extra bucks each year for doing nothing extra, this might be for you. I mainly see this as a bonus to combine with the savings account offer.

Wells Fargo Propel American Express Card

Wells Fargo has updated the Propel with a competitive offer for 2018. The card has no annual fee, no foreign transaction fee, and a very large unlimited 3% cash back category.

Similar Offer Notice

The Uber Visa is similar card with a focus on Restaurants from Barclays. It provides 4% unlimited cash back at restaurants, 3% on airlines and hotels plus the same mobile phone protection package:


  • $0 Annual Fee
  • 0% Foreign Transaction Fee


  • $300 Signup Bonus after spending $3,000 in the first 3 months.

Cash Back

  • 3% Cash Back on Restaurants, Hotels, Flights, Transit, Car Rentals, Gas Stations and some Streaming Services.

Travel: Airline, passenger railway, hotel/motel, timeshares, vehicle/auto rental, cruise lines, travel agencies, discount travel sites, campgrounds, passenger trains, taxis, limousines, ferries, toll bridges and highways, parking lots and garages.
Gas: Gas station and automated fuel dispensers.
Dining: Eating places and restaurants, drinking places, or fast food restaurants.

Other Benefits

  • $600 Mobile Phone Protection. Has a $25 deductible with max 2 uses per year for a total of $1,150 in protection annually.

Travel Drawbacks

While there are tons of unlimited 3% cash back categories this card has no real travel perks. You wont be getting TSA Pre, Airport Lounges, etc. with this card; however, you wont pay an annual fee either. So if you travel frequently and need real travel benefits you may need a better card for your primary travel card.

While American Express has quite a large acceptance rate its still not as high as Visa or MasterCard. So when traveling you will need another card type as a backup. You should never rely on a single card when traveling due to high chances of triggering fraud detection as well as actual fraud or other technical issues.

More Details

Cash Back

Wells Fargo uses Points for this card. Each 100 points is worth $1. So 3x points means 3% cash back. You can redeem your points for statement credit (cash back) in $25 increments. You can also use them for other things through Go Far Rewards.

Wells Fargo Visa Signature Card Combo

If you have the Wells Fargo Visa Signature Card (the new REWARDS version and not the old CASH BACK version) then you can transfer your points from the Propel card to the Signature Card and redeem your points for 50% more on Flights through Go Far Rewards. So if you use your points to buy flights through Go Far Rewards you could get 4.5 points (4.5% cash back) per dollar spent. I have the old CASH BACK Signature Card and have not been able to test this yet.

Uber Visa has 4% at Restaurants and Mobile Phone Protection

The Uber Visa provides unlimited 4% at restaurants, 3% on travel, $600 mobile phone protection and much more all for no annual fee and no foreign transaction fees.

Similar Offer Notice

Wells Fargo has a similar offer from American Express, the Propel Card. This provides the same mobile phone protection and 3% cash back on Restaurants, Flights, Hotels, Gas Stations, Car Rentals, and Transit:


  • $0 Annual Fee
  • 0% Foreign Transaction Fee


  • $100 Signup Bonus. Just charge $500 within the first 90 days.

Cash Back

  • 4% Cash Back at Restaurants and UberEATS. Basically anything that shows up as a restaurant on your statement like DoorDash, etc.
  • 3% Cash Back at Hotels, Airlines and Vacation Home Rentals. If you don’t already have a travel card this is pretty for no annual fee.
  • 2% Cash Back on Online Purchases. This category seems a bit blurry but things like Netflix, Spotify, etc. would probably qualify. You can also get unlimited 2% cash back with a card like the Citi Double Cash.

Other Benefits

  • $600 Mobile Phone Protection. Has a $25 deductible with max 2 uses per year for a total of $1,150 in protection annually. See below…
  • $50 online subscription credit if you spend $5,000 a year. See below…
Mobile Phone Protection

On top of the above cash back, you also get mobile phone insurance up to $600 per claim a maximum of twice a year for a total of $1,200/year in protection. While $600 wont cover the full cost of a new phone, it is quite a large discount with only a $25 per claim deductible. This also works as additional coverage on top of any existing coverage and can be used for any remaining replacement charges up to $600.

Online Subscription Credit

Additionally, If you manage to charge $5,000 a year on this card you will also qualify for $50 a year in online subscription credit. I can easily hit that with restaurants and a cell phone bill. For some it might be a challenge to do if you only use it for restaurants and your phone, but if you also charge at least one vacation a year it should be easy to achieve.

For full details on the benefits please see this FAQ:

For full terms and conditions please review this:

Personally I do not use Uber and have no plans to use Uber. I am only seeking this card for the cash back and mobile phone protection.

More Details

If you plan on applying for this credit card (or any credit card) make sure your credit is in good shape first. Barclay’s has discontinued their pre-approval form so you can not check before applying. The most important factor is Credit Utilization, so if necessary pay down your balances ahead of time and before your statement dates. For more information on monitoring your credit see this article (the advanced section has more about preparing for an application):

Barclays usually does a Trans Union pull when possible (may vary based on location). I also believe they use your FICO 8 Score (I will have more verification on this soon) which you can check for free (see above article).

For additional information about Barclays Credit Cards see this article:

Disclaimer: I am not yet a card owner but plan on applying for this card very soon.

Automate Manual Payments with Bill Pay

In once sentence, automate your rent and other checks with your banks Bill Pay for free.

These days almost everything allows you to configure automatic payments. There are still a few occasions when you need to write a check. In many cases landlords and other services still only accept check payments. Most major banks provide a free Bill Pay service that can be used to manually or automatically send checks to recipients with custom memos.


Bill Pay can allow you to do the following:

  • Automatically send checks to designated payees.
  • Send them manually or on a recurring schedule.
  • Pay other bills, get notifications, reminders and alerts.

Getting Started

First you need to make sure your bank supports Bill Pay. You log into your banks portal and look for a Bill Pay section. For a list of banks that support Bill Pay see this article:

The steps will be somewhat different based on your bank but the process is about the same and very simple.

  1. Setup Bill Pay at your banks website.
  2. Add payee’s you wish to send payments too.
  3. Send a one-time payment or setup recurring payments.
  4. Set an amount and custom memo to appear on the check.
  5. Choose a send-on and receive-by date for the check to be sent.

Your bank will mail a check to the payee’s address for the amount you specify. You may be able to configure alerts and notifications for the payments.


Stop writing checks for rent and other recurring services. If your bank does not support Bill Pay I suggest you look for a good one that does. While I do not recommend one of the Big Four you can get $200 to open a Chase checking account.

Zelle – A Faster Built-In Alternative to Square and Venmo

Zelle is an app to send money to family and friends you know directly from your banking app, instantly and free.


Why should you use Zelle?

  • Built-In to your banking app, nothing to download or signup for.
  • Send money instantly from your bank to theirs.
  • Completely free, no costs at all.

What are the downsides?

  • Not all banks support Zelle (most major banks do).
  • Sender’s full name is disclosed to the recipient.

Zelle does have an app that works with your debit card if your bank is not supported. I have not had the ability to test this due to all my banks supporting Zelle. Only use this if your banking app does not support Zelle:


So why is Zelle able to provide instant, free service unlike competitors (Venmo and Square); who charge a fee for instant transfers? The short answer, Zelle is owned by the banks.

Competitors are separate businesses from banks and need to make money also. If they allowed you to instantly transfer the funds, they would not be able to hold on to the funds and earn interest on it like banks do. This is why you must wait at least one day or pay a 1% fee to instantly receive the funds.

During that one day the funds are sitting in the competitors accounts, banks are not making money on those funds. Zelle is owned by the banks and offers free instant transfers to combat the competitors. By not transferring the funds to the competitors for a day the banks continue to earn the interest on the funds.

Getting Started

First check to see if your banking app supports Zelle.

If so, you should fine more info how to Enroll your mobile number or e-mail address to receive Zelle payments. Enrollment lets you choose your pay from account and pay to addresses. The recipients for which you wish to send money too must also Enroll with Zelle.

Once both parties are enrolled with Zelle and you have their confirmed phone number or e-mail address, you should be able to send them money instantly from your phone app or banking website.

For more information, visit Zelle at

Best Financial Apps and Tools for 2018

From sending money, to tracking expenses, to trading stocks and options; these are some of the best financial tools available today.

In no particular order, we now present…

Personal Capital

This is probably #1 (ignoring the order above comment) since it is able to track almost every aspect of your finances. This app will automatically track your expenses, income, investments, net worth, and more. There is a full article here:


Free Stock:

Robinhood, while not the best broker available, is my top recommendation and primary app for trading stocks and options. Enter the new world of zero trade fees on all stock and options trades. You even get 1 free stock just for signing up here. I have been using Robinhood all year and not looking back. There is a full article here:

Cash App

Free $5:

Square is an amazing financial services company and their Cash App is just as amazing. This app allows you to send and receive money at no charge to friends, family or co-workers. Great for paying back lunch, splitting bills, or sending someone money. Square offers many other financial services as well. I have used it side by side with Venmo and in many instances Venmo has been up to 1 day slower to deposit funds in my bank, and up to 5 days slower to charge my card for funds sent; I also do not like supporting PayPal. Get $5 free after you send $5 if you sign up here.

Update: An alternative to Square that is instant, free and built-in to your banking app is Zelle. Use it to send money to your friends and family:

Credit Karma

Probably the best credit monitoring/tracking app available. You get weekly updates from TransUnion and Equifax. The app also presents your accounts and the details in a very easy to view layout. The score is VantageScore 3 but the goal here is to monitor what is on your credit, and not the number. For more information on monitoring your credit and credit scores see:


Simply put (pun intended), Simple is a bank inside an app. If you don’t want a brick and mortar bank and want to do it all from your phone then Simple is for you. Turn most ATM’s into your local branch for withdrawing cash. Transfer money to and from accounts, including external accounts at no charge. If you already have a bank and it is working for you, then no reason to switch. I used Simple until they were purchased by BBVA Compass at which time I let the account go. I really have nothing bad to say about them and may start using them again in the future.

Dollar Bird

Many of you won’t find a need for this app. I like it for its simplicity. The primary use for this app is to monitor the balance in my primary checking account. Not many transactions go through my bank since I run everything possible on a credit card for cash back. I am able to setup recurring payments like rent, loans and auto-pay credit cards, plus recurring income like salary. Everything else is super easy to manually enter like credit card payments, transfers, etc. You can also change the date or amount on a recurring payment with or without effecting the series. The only downfall is it shows your current balance in the primary display area and does not calculate future debits before credits (total before next pay day). You can however see the available balance for any day. To help visualize my balances I set my auto-debits for the pay period to deduct on the same day I get paid so the totals are more accurate.

Your Banking or Credit App

Regardless of your bank or credit card you should have your banks app downloaded on your phone. Most major banks offer useful features that usually include:

  • Mobile check deposits.
  • Deposit and spending notifications.
  • View, transfer, pay, and manage your funds.

You can usually download an app for each of your banks and credit cards. For me the most valuable feature is the notifications. I am instantly alerted any time a transaction is made that meets predefined criteria.

Track Spending, Income, Assets and Investments with Personal Capital

In once sentence, Personal Capital is an app to automatically track all your spending, income, assets, investments and net worth.

Get $20 Amazon Gift Card here:


While Personal Capital offers premium investment management features for portfolios over $100,000, I am more interested in the free expense, income, asset, spending, and portfolio tracking features.


  • Ability to link all your accounts (US Only).
  • Track all your spending/income by category and date.
  • Track all your portfolios change and distribution.
  • Add manual accounts and portfolios (tickers auto update).
  • Beta support for cryptocurrency (plus Chrome Extension support).
  • Automatic Net Worth calculations (assets and liabilities).
  • Real estate valuation through Zillow (if you count this).


  • No API (as a programmer this is huge downside).
  • Expense categories are sometimes inaccurate (easy to fix).
  • Cryptocurrency only seems manageable through Chrome extensions.
  • Unable to export reports.

Key Features

In the short time I have been using the app, these are some of the feature that I like the most.

  • Ability to view all your expenses across all accounts by time and date.
  • Compare income, expense, savings, and investments side by side.
  • Excellent Net Worth calculator, all done automatically.
  • Track all your investments individually or as a whole.

Getting Started

They require a mobile phone for two-factor security, otherwise, just head over to Personal Capital and sign-up.

The first think you want to do is add all your credit cards. This will allow you to track your spending by category and date. You should also link your bank accounts to track loan and mortgage payments, or other expenses that go through your bank. You will want to go through and check the categories to make sure their correct. You may also want to create some custom categories to help you better track your spending.

Second, you can add the rest of your assets including your investing accounts, Robinhood, Ameritrade, and retirement funds like 401(k)’s and IRA’s. This will allow you to track your growth and holdings of your investments. You can view individual or all accounts, the holdings breakdown, and return on investments.

Lastly, if you have any accounts that are not supported or manually managed, you can add many different manual accounts. Manual investing accounts with matching tickers will automatically update. There is a Chrome extension called pfcrypto that will update your custom cryptocurrency holdings every time you log in.

Tips and Tricks

Expense and Income Categories

Not only were some of these incorrect, I also wanted to place some expenses in custom categories. You can easily search and edit multiple transactions at the same time.

External Accounts

I got an error adding my Robinhood account, but it eventually showed up with all the information. I was unable to add my Acorns account, it keeps saying  bad username and password (I don’t plan on using Acorns anyway). And I had to manually add my cryptocurrency holdings and keep them up to date with a chrome extension.


The first thing I checked into. They use Yodlee and all your access credentials are stored with them. The web interface is protected with two factor authentication. You can not transfer money between accounts or make changes from Personal Capital.

For a full security review, check out this article:


I strongly recommend this app to anyone looking to track expenses or net worth. I am still new to this app but extremely satisfied with the features available. I have a very strong hope that an API becomes available in the future. Let me say this again, I really want to see an API!

I will continue evaluating and make updates if any breaking information comes to light. Feel free to leave comments if you have anything additional to add that I have left out.

Sign Up here:

Credit Cards – Why You Should Use Them and How

If you think that credit cards are bad or should be used when you need to borrow money, you have probably not been properly educated on the uses and benefits of a credit card.

You should be using a credit card for every purchase you possibly can!

Misconceptions About Credit Cards

Lets start by covering some common misconceptions around credit cards.

Using my debit card as a credit card is the same as using a credit card

NO. Using your debit card as a credit card is just as bad as using cash or debit. You receive almost none of the benefits of a credit card or any cash back when using your debit card as a credit card.

You have to pay interest on credit card purchases

In short, NO. Each month you get a statement with your all the unpaid charges from the previous month. You must pay the amount listed on the current statement before the due date or you will incur interest on any unpaid portion. If you are not paying your statement balance in full every month you are using your credit cards inefficiently.

Credit cards are for borrowing money and financing purchases

In short, NO. You don’t use a credit card because you need money or to finance a large purchase except under extreme or special circumstances (emergencies and no interest offers). Credit cards have a high interest rate if you don’t pay your balance in full each month.

Credit cards don’t boost your credit very much

In short, NO. Credit cards are extremely important for your credit score and history. Mortgages and installments are eventually paid off, closed and removed from your credit report.  Credit cards can last forever and count towards your available credit.

I am financially sound and have no need for credit or credit cards

You are the best candidate for a credit card. You can enjoy all the benefits credit cards have to offer and are in perfect shape to start using them today. You can also start building your credit for the future in case you change your mind on buying that house.

When Not to use Credit Cards

Before I tell you why to use a credit card, make sure you know when not to use a credit card. As mentioned above, credit cards are not for financing purchases or spending money you do not have. Also if you are not a responsible individual, credit may not be for you, yet (don’t ruin it for future you, bad remarks lasts 7 years).

If you are already behind on bills and missing payments you should not be using a credit card. The late payments and interest charges will not outweigh the benefits. If you are in need of additional funds a personal loan will almost always give a better interest rate.

When to use Credit Cards

If you do not fall into the above category, then you should be using a credit card for every purchase possible. There are a few exceptions however:

What can you not pay with a credit card?

Other lines of credit such as credit cards, loans, mortgages, etc. Also cash only operations; however, these are becoming less and less frequent with digital coverage and devices expanding including the supporting services.

What if there is a fee for using a credit card?

That depends on the transaction amount, cash back rate, and total fee. Example, if you have the option to pay your $1,000 rent for a flat $5 fee on an unlimited 1.5% cash back card; you would get $15 cash back minus the $5 fee for a profit of $10 dollars. Even when the fee is more than the cash back it may be worth the convenience of using your credit card or be worth the benefits provided by your credit card to pay a little more.

How to use Credit Cards

You insert the side with the side with the chip… Just kidding. But seriously, make sure you know how to use your credit card with out paying interest or fees otherwise it will cost you money and hurt your credit.

Pay your statement in full every month

Every month you get a statement which has two numbers. The full statement amount and minimum payment due. Before the due date you must make payments totaling the amount on the statement or else you will be charged interest on the difference.

Pay at least the minimum every month

You must pay the minimum amount due every month to avoid late fees, additional interest and a bad mark on your credit report.

I strongly recommend setting up automatic payments for at least the minimum payment amount. This way if you forget or become physically unable to pay you at least avoid a bad mark on you credit with the smallest impact on your bank account.

Benefits of Using Credit Cards

Now for the good stuff.


Using your credit card provides a 100% safeguard against fraud in ways using your debit card or debit card as credit does not. If your credit card is compromised for $5,000 you will get a notification or bill in the mail for the that amount, dispute the charge, and eventually the charge will be removed. However, if you made the same transaction with your debit card, the $5,000 would be deducted from your available balance in your checking account and you would be with out the $5,000 until the fraud investigation is complete and the account has been credited.

Additionally most credit cards provide a guarantee of the purchase as part of their benefits which allows them to place a chargeback against the illegitimate merchant should it be deemed appropriate.

Cash Back

If you weren’t sold on the security benefits (I was) then you should be sold on the cash back, literally. As you probably know, credit companies charge merchants a percentage of the sale to use your credit card. To entice consumers to use their credit card more, they share a percentage of that transaction fee back with you.

Currently you can get up to an unlimited 2.5% cash back on every transaction with a $59 annual fee and up to 2% cash back with no annual fee. For more information about cash back credit cards read this article:

Keep in mind you can use your credit card for almost everything including your bills such as electricity, insurance, cell phone, internet, etc.

Additional Benefits

This part is not so straight forward as all cards come with different benefits, but, most have the same basic benefits. Some standard benefits provided by most credit cards include:

  • Rental Car Protection
  • Fraud Protection
  • Mobile Phone Protection
  • Road Side Assistance
  • Other Travel and Emergency Services

For a full list of standard Visa benefits see:

For a comprehensive guide on credit card benefits see:

How to get a Credit Card

So your ready to get a credit card. Don’t start applying before you know which credit card you want, and if you will be approved or not.

First, If you have not already, you should look at your credit and make sure its in good shape. Check out this article for information on how to monitor your credit:

Second, unless your credit is immaculate you may want to see if you per-qualify before applying. This will give you a soft yes or no with out effecting your credit score. This can be done at any time with no effect:

What to Look for in a Credit Card

There are so many cards, benefits, fees, etc. Which ones are the most important to look for?

Cash Back

Obviously the more cash back the better; however, the cards with the best benefits and cash back rates usually have an annual fee. So make sure you will use them enough to outweigh the annual fee. See this article for more information:

Foreign Transaction Fee

If you plan to travel outside the country make sure your card has a 0% foreign transaction fee. This will allow you to use your card abroad at the current transaction rate for your currency at no additional fee. Additionally, you usually get to enjoy the cash back from these purchases as well.

Annual Fee

If this is your first credit card, make sure it has no annual fee. You should keep your first credit card forever. This will serve as the oldest account on your credit report. Never close this card (or any cards with no annual fee unless you have a very good reason). If your card does have an annual fee, make sure the benefits are outweighing the fees; otherwise, it might be worth closing that card.

Card Type

Not all credit cards are accepted everywhere. The most accepted card is Visa followed very closely by MasterCard. Next in line is Discover followed by American Express. Credit card acceptance is becoming less and less of an issue as time goes by; however, if you only have 1 card, I recommend a Visa or at minimum a MasterCard.

Credit Score Information, Monitoring and It’s Importance

Unless you are independently wealthy, your credit score is more important than you think. Even if you don’t need or use credit, you should at least be using Credit Cards for security and cash back. Additionally you can receive bigger discounts on home and auto insurance with good credit.

Why is Credit Important?

As mentioned with good credit you can enjoy the following benefits:

  • Credit Cards – Everyone should have one as these provide cash back on every purchase, security from fraud and additional cardholder benefits.
  • Home and Auto Insurance – Some factors on your credit reflect your Insurance Score which is used to determine your insurance premium.
  • Renting – Many commercial and individual realtors rely on your credit check when choosing tenants and a good score can increase your odds.
  • Low Interest Borrowing – When you do need to borrow for a car or house, you will get the most competitive rates with good credit.

What are Credit Scores?

A credit score is an overall rating of your entire credit report and is a single indicator of your creditworthiness. The score is not a decide-all factor and a lender may approve a loan for someone with a lower score after a full review depending on their credit report.

There are 2 scores you will hear about and 3 major reporting agencies. These score can change daily and vary based on the agency used. Lenders may use one or more of the scores or agencies. There is also a major difference in the 2 scores (more below).


This is the score used by the majority of lenders. This is not straightforward at all as there are countless different versions of FICO scores used based on the agency and company requesting the score. A comprehensive list of FICO scores and which agencies use them can be found here:

The current version is FICO 8 and FICO 9 the future version; however, many lenders are still not even using FICO 8 yet. Currently, the only version of FICO you can get for free is FICO 8.


This score is rarely used by lenders and heavily used by consumer credit (free credit report) providers such as CreditKarma, WalletHub and NerdWallet. There is only 4 versions of this score with version 3 being the current one and 4 the future version. This score is more generous than most FICO scores and is usually 50-100 points higher than the FICO used by your lenders.

How do I Monitor my Credit and Score?

Fraud and erroneous information can end up on your credit and you don’t want to find out about it when your applying for that new credit card or car. Today it is easier than ever to monitor your credit and you can do it right from an app on your phone.

VantageScores, while not used by many lenders, still reports about the same information which makes it good for monitoring credit changes; since your FICO can not be retrieved as frequently. Credit Karma provides scores from 2 agencies but only updates weekly, while WalletHub can provide daily updates on credit changes. Both Discover and Free Credit Score update monthly, or on your next login, so you should only check these before applying for credit for the most recent results.

Update: The best service for viewing your credit report is Experian.

Name Score Agency Frequency
Credit Karma VantageScore 3 TransUnion, Equifax Weekly
WalletHub VantageScore 3 TransUnion Daily
Discover FICO 8 Experian Monthly
Experian FICO 8 Experian Monthly

Note: none of the above will hurt your credit or show up on your credit report.

Keep in mind that the goal is not to monitor your credit score (since the one your lender will use is probably different) but to monitor your credit report and changes.

How do I Improve my Credit Score?


If you are not applying for a car, loan, house, etc. you do not need to anything special except make sure you have a credit card and keep it in good standing (this way you have a credit history and available credit).

  • Always pay all credit accounts on time no matter what the cost.
  • Never let a non-credit account or bill end up in collections/on your credit.

These and all negative marks will stay on your report for 7 years and cause major damage. Now lets move on to the good stuff.

  • Don’t close your old credit cards with no annual fees. Setup auto-pay for the minimum payment and attach a monthly charge under $15 to it.
  • Open new credit cards with no annual fees and leave them open. This will increase your total credit availability, decrease credit utilization and increase credit length.

Everyone should have and use a credit card whenever possible. For more information about credit cards, read this article:


If you are planning on applying for new credit card, an auto or personal loan, you will want to understand all the factors that effect your credit and know how to prepare for the the application.

Payment History & Negative Remarks

As mentioned above, this weighs in very heavy and last 7 years. You may not be able to do much about these but if you have negative remarks that will be removed soon, you should wait til they are gone before applying for a large loan if possible.

The more late payments and the more recent the bigger they will hurt. It is highly recommended enabling auto-pay to avoid these from ever happening. If you can’t pay your bill, call your creditor before hand and try to work out a later payment date acceptable with them so your credit is not effected.

If you have Paid Collections or Medical Collections that you can’t get removed you can attempt to seek a creditor using FICO 9 (Wells Fargo) or VantageScore 4 (none known). Both of these newer models weigh paid collections and medical collections much lower.

Credit & Debt Utilization

Second to above, your credit utilization weighs in very heavy, about 35%. This is how much you owe across all your accounts vs how much credit you have available across all your credit cards. Pay off all your credit cards and pay down your loans as much as you can before applying.

This is looked at with both your Credit Card utilization and also with your total balances (excluding mortgages). Credit Card utilization is the most important and counts negatively if it is too much. Always keep your total Credit Card utilization below 30% (that means 29% or less). You should also try to keep all individual cards below 30%. For a premium score, individual and total balances should be below 10%.

Credit Age & New Accounts

This is not weighed as heavily, but the longer your report, the better. The age of your credit (average length of open accounts) can only be increased by letting time pass. However, you can avoid opening new accounts. Not only does this reduce your average credit age, but also shows up as a new account (1-2 years old).

FICO 8 and 9 looks at the last 12 months while VantageScore 3 looks at the last 24 months. Having too many new accounts is a sign of risk to lenders so the its best to plan out your credit applications and make sure you are only applying for what you need.

Hard Inquiries

When you apply for credit it shows up as a hard inquiry (that your credit was pulled in review for a credit application). This shows that you have recently applied for new credit and can be a sign of risk. These inquiries usually stick around for 2 years, so avoid applying for credit right before that big application.

This is basically an agreement with lenders so that other lenders know when you apply for new credit. Other things can cause hard pulls such as utility, phone and internet service providers. This usually shows up as a utility pull and not a bank; however, should still be avoided when possible.

Some lenders let you apply for multiple cards (usually up to 2) with a single hard pull; however, your credit profile must be strong enough to justify getting 2 new lines of credit at one time and usually results in an auto-decline on the second card requiring you to call in. Only do this if you know what you are doing.

Account Diversity & Total Accounts

The more accounts you have and wider variety of accounts will improve your credit. This shows that you have experience managing multiple accounts of different types. There is not much you can do to improve this with out taking on new debt, which is not something you should do before applying for a large loan.