What to Look for in a Credit Card for Military Members

Military members and their families often have unique financial needs. They also have unique options when it comes to the financial products available, including exclusive ones that aren’t available to the general public.

And thanks to federal legislation, even standard credit cards often come with perks for military members.

If you’re looking for a military credit card, here’s everything you need to know.

How do military credit cards work?

Military members often have access to exclusive perks and benefits. There are two broad categories of these benefits:

• Benefits mandated by the Servicemembers Civil Relief Act (SCRA): The government requires banks to offer certain benefits to military members and eligible veterans.
• Benefits offered willingly by banks and credit card companies: Some banks go above and beyond these requirements to offer even more benefits. For instance, they may waive annual fees on credit cards for military members or provide reduced interest rates for veterans.

Military members also have two categories of cards available to them:

• Standard credit cards: Available to the general public (but may offer additional perks for military members)
• Military exclusive credit cards: Only available to military members and their families

To better understand both standard and military exclusive credit card perks, it’s helpful to first understand the SCRA.

Benefits mandated by SCRA

The Servicemembers Civil Relief Act passed in 2003. It aims to provide legal and financial protections and benefits to military service members.

Who qualifies for the SCRA?

The SCRA provides broad benefits and perks, but the most relevant rule for credit cards is that interest rates are limited to a maximum of 6% on any debts taken out before military service. Considering that the average credit card’s annual percentage rate (APR) is above 20%, this is a considerable discount over standard rates.

Note that SCRA protection only applies to credit cards taken out before you begin your service, so any taken out during or after active duty likely won’t qualify.

Finally, the 6% rate cap applies only while you are actively serving. Once you leave the service, the credit card issuer can increase your rate to the standard APR.

The SCRA in practice

To illustrate military credit card perks, let’s look at an example.

Samantha has $12,000 in credit card debt at an APR of 22%. She decides to join the military and submits a request to her lender to qualify for SCRA benefits. Once the lender confirms her active duty enrollment, Samantha’s APR will be lowered to 6% during her military service. The APR will remain at 6% until Samantha leaves the service, at which point the lender can increase the APR.

This perk can lead to significant cost savings. In the example above, Samantha’s debt would accumulate $2,640 in interest in just one year at a 22% interest rate. But with the 6% APR cap, the interest would only be $720 in one year.

Taking out a credit card while on active duty

If you’re looking to take out a new credit card during active duty, various credit cards offer benefits to military members. The following sections will walk you through what to look for in a credit card and what options are specifically available to military members.

Tip: For more general tips, see our guide on what to look for in a credit card, or explore all your options with the Kudos Explore Cards feature.

What to look for in a military credit card

When choosing a credit card, here’s what military members should consider:

Availability based on credit score

Remember that military members still have to qualify for credit cards by applying.

The lender will review the applicant’s credit score and history to determine their eligibility. Active-duty servicemembers are typically not given any special treatment regarding credit requirements. For this reason, checking your credit score and knowing which cards might be available to you is essential.

If you have good or excellent credit, you should have a wide range of options. On the other hand, if you have bad credit, your options may be limited, or you might need to start with a secured credit card.

Card features

Various credit card features and perks are also useful for military members. Here are some of the most important to pay attention to:

No foreign transaction fee. Foreign transaction fees charge you extra when you make purchases outside the United States. However, many cards waive this fee, which is helpful for active-duty military members and anyone traveling.

Rewards. Many rewards cards offer rewards on your spending, which come in cash back, flexible points, or airline miles. Cash back credit cards and rewards cards are one reason some people use credit cards for everything.

No annual fee (or waived fees). Depending on the card, many credit cards charge an annual fee — anywhere from $25 to $550 or more. So it’s best to look for a card with no annual fee — or, for military members, a card with an annual fee from a card issuer that waives the fee for active duty members. This can be a good way for a military member to get a premium credit card with great perks.

Other benefits. Various other benefits, such as purchase protections (which protect items from damage or theft), travel perks, and credit monitoring tools, are also useful.

Bonuses and promotions

Many credit cards offer sign-up bonuses or limited-time promotions. These are often worth taking advantage of, as they can help you earn bonus points or save money on interest.

For example, a card might offer a $200 cash bonus once you sign up and spend $1,000 within the first 3 months. Another card might offer 50,000 airline miles after you spend $3,000 within the first 3 months. Or, a card might offer 0% APR for the first 12 months of card membership.

Military exclusivity

Some credit cards are only available to military members and/or their families. Many of these are offered by military-exclusive banks and credit unions.

These cards often have good features, low fees, and lower-than-average APRs. But before you get one, it’s important to compare it to standard card options. There are some excellent military-only card options, but just because a card is an exclusive military card doesn’t mean it’s automatically the best card for you.

Best credit cards for military members

There are many great options, but we’ve made it simple with two excellent picks.

American Express Platinum

The Platinum Card from American Express is a luxury travel rewards credit card with various benefits and perks.

It’s designed as a premium travel card with a very high annual fee of $695. However, American Express waives the annual credit card fee for military members, so active duty members can enjoy this premium card’s perks with no fee!

And there are many perks to enjoy.

The American Express Platinum Card offers:

• A $200 annual hotel credit
• A $240 annual digital entertainment credit (Hulu, Audible, and more)
• A $155 Walmart+ credit
• A $200 annual Uber/UberEats credit
• A $200 annual airline fee credit
• A $300 annual Equinox credit
• Access to airport lounges
• And more

The annual travel credits and other annual credit perks can add up.

The card also earns 5x membership rewards points on flights and hotels booked through Amex Travel and 1x points on everyday spending (all other purchases). And there’s often a substantial sign-up bonus for new members.

USAA Everyday Cashback Rewards Plus

The USAA Everyday Cashback Rewards Plus card is a great no-annual-fee credit card with generous rewards.

The card earns 5% cashback on gas stations and military base purchases, 2% back on grocery store purchases and supermarket purchases, and 1% back on all other purchases. Rewards are straight cash back statement credits, which keeps things straightforward.

Other perks include extended warranty coverage on eligible purchases, travel insurance, and rental car insurance. There’s also no foreign transaction fee, so this card is a great one for travelers.

Bottom line

Servicemembers can access exclusive credit card benefits thanks to the Servicemembers Civil Relief Act. Plus, some card issuers go above and beyond by waiving annual fees or offering other perks to military members.

The cards discussed above are great options for military members. If you want to get the most out of all your credit cards, use the Kudos Smart Wallet to maximize your rewards and benefits.