How to Save Money on Credit Cards If You Are in the Military

$ 250. 450 dollars. 550 dollars. Annual travel premium card issuance fees continue to rise. But military personnel on active duty do not need to pay these fees at all. This significant rebate is made possible by the Military Credit Act (MLA) and the Civilian Assistance Act (SCRA) , laws designed to protect military personnel from unfair credit and credit practices.

The most recent version of the MLA grants the following rights to members of the armed forces on active duty, including those on active guard and active reserve service:

  • The 36% interest rate cap, which includes finance charges, insurance premiums or credit insurance charges, or “participation fees” (this is called the military’s annual percentage rate, or MAPR).
  • Exemption from obligatory arbitration rules from creditors
  • No mandatory payroll deductions to pay off the loan
  • No penalty for early repayment of the loan in whole or in part.

Spouses and other dependents are also included in these benefits.

“This annual war income can make a big difference to the earnings of the military,” said Spencer Reese, a serving Air Force officer who runs the War Money Tutorial blog.

“Interest rates on traditional loans and credit cards are usually not as high as the quoted 36%, but keep in mind that the military annual interest rate applies to all fees you may encounter other than interest,” Reese explained. This 36% includes late fees, annual fees, and other ancillary services that are charged by lenders. “There’s such a complex formula that you can find on the Internet,” he said, but some credit card issuers have decided it’s easier to simply abolish military fees altogether.

Reese singled out a few key players for us who rewarded us.

American Express does not charge any personal or service credit card fees for active duty members of the armed forces and their spouses.

Chase waives all annual personal credit card fees for active duty military personnel and their spouses. Select military as your source of income when applying and Chase will validate your status for you.

Capital One will only waive annual fees if you open your account prior to active service. If you start serving in active duty, you can apply for SCRA benefits for this period of time to charge you. Barclays and Citi have similar rules.

How MLA Benefits Are Changing the Math of Military Rewards

“Since [the military] can opt out of paying fees on these cards, it really changes the calculation of benefits,” Reese explained. With no annual fee, benefits like free hotel stays, unexpected airfare, travel credits or upgrades are better than free. The dollar value of these awards can quickly climb to over $ 1,000, he wrote in one blog post.

These benefits can make travel more comfortable, be it personal or business travel. “When we fly on commercial flights, we are usually on the cheapest flight with the worst connections and even at the worst times. So it’s nice to be able to go to the lounge, get a free meal, get a free drink and sort of get away from the crowd while we wait for our next flight. “

Combine the extra perks with the ability to earn points to spend on free travel or discounted travel and you’ll be a thug, but, you know, legally.

How to check your status before applying for a new card

Credit card issuers run claims through two federal databases to confirm your current service status. But you can do the same verification yourself before applying for a new credit card.

In order to use the MLA database to execute a single record request, you need to create a login. You can also create an account to check SCRA database on the availability of their own records.

But this move is not required on your part. If you do not check your status before applying, you may find that you are charged an annual fee in the first month. You can log into your account for your new credit card to request SCRA benefits for the military, and in most cases, the commission is charged and you will never see it again.

“You don’t have to go crazy,” Reese said. “You don’t need to open 40 cards like mine.” But your unique military status is something you can take advantage of, he said. “You will only be on active duty for a certain number of years. As long as you are, this is a real tangible benefit that you can enjoy. “


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