How to Make Credit Cards Work for Your Military Family

Woman on the phone holding a credit card.

For military families, credit cards can be a game changer … or a game ender, depending on how they are used. Let's face it: No one wants to rack up a ton of debt, but using a credit card responsibly can actually improve your credit score. When you choose the card that works for your family, you can build a positive credit rating and earn back cash or other rewards.

Here are five smart ways to get and use a credit card to make the most of your military family income:

1. Find the card that benefits you most. It seems like every store or organization is offering a credit card these days, and not all of them are a good idea. Be smart and investigate the best fit for your family. Eat out a lot? Looking for a low interest rate? Looking for the best rewards program? Credits cards like the ones offered by Navy Federal Credit Union are tailored to benefit your lifestyle. Navy Federal has several cards with no annual fees and waives foreign transaction fees on all its cards, which is helpful when your spouse may need to use the card while deployed.

The Navy Federal More Rewards American Express® card* offers three times the points at supermarkets and gas stations; two times the points at restaurants; and one point on everything else. That's a great opportunity for military families to earn points just by purchasing everyday items they need anyway.

Among the options is the cashRewards card, which rewards you with 1.5% cash back on purchases. You can even start redeeming rewards as soon as you earn them. Another option is the Flagship Rewards card, which rewards you with 3x the points on travel and double the points on everything else.

The bottom line: Look at your military family's needs and where you spend the most, then shop around for the card that will give you back — in points, cash or benefits — the highest reward for your spend.

2. Consider your military lifestyle. Unexpected PCS orders, a short-fused TDY, a much-needed trip to see family: These are all aspects of military life that may require some "enhanced" use of your family credit card. Knowing what your credit limit is, as well as how much you currently owe, is important when military life throws a curveball and you need to use your credit card. Make sure your card provider offers 24/7 member service to meet these unanticipated demands.

3. Know your benefits. Did you know the Servicemembers Civil Relief Act limits the interest rate on debt accrued before someone goes on active duty? This is to ensure service members are not incurring more debt through high interest rates while beginning their service or, in the case of Guard members and reservists, when called to active duty.

According to Military OneSource, "Creditors must reduce the interest rate on debts to 6 percent for liabilities incurred before you entered active duty." That's good to know if you are new to military life, and it may save you money in interest charged on your monthly bill.4. Use your military status to help build your business. Many military spouses work for themselves or build a business during their spouse's time in uniform. The frequent moves and changing markets of each duty station can make it difficult to find and keep a job, so entrepreneurship is a great option. However, building a business takes time and money. NFCU Business Members have access to small-business advisors, mobile and online banking with free Bill Pay, a choice of business checking accounts to suit your business needs, competitive business credit offerings, and merchant card processing solutions.

5. It's not just about your bank account. While most people worry about credit and how it can impact their financial bottom line, military families have to go one step further and think about their clearance. One of the most common reasons to have a security clearance revoked or denied in the military is financial difficulties or overwhelming debt. That's why it's important to know which card is right for you, and to choose a card from a reputable organization.

In the end, of course, the responsibility remains with the card holder to manage their card properly, but organizations such as Navy Federal offer personal finance counseling and resources to help you manage your spending and ensure you aren't risking your clearance.

Credit cards can be a wonderful and convenient way to purchase what you need and earn rewards while you do it. As a military family, you have unique options for your credit card needs that are not available to everyone. Identify what your specific needs are, choose the right card for your family, and manage your spending to ensure a lifetime of good credit and maybe even some cash or points towards a vacation along the way.

Navy Federal is insured by NCUA

*The Navy Federal More Rewards American Express® Card is issued and administered by Navy Federal Credit Union. American Express is a federally registered service mark of American Express and is used by the issuer pursuant to a license.

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