Military STAR™ card helps reduce holiday expenses DALLAS – Like many Americans, members of the United States military must keep a close watch on their budget during the holiday season to ensure they are not spending too much on commercial credit cards with high-interest rates or costly payday loans. The Army & Air Force Exchange Service (AAFES) developed the exchange credit program (now known as Military STAR) more than 20 years ago in response to military leadership’s concerns regarding a growing number of rent-to-own, pay-advancement schemes and unacceptably high interest rate scams that military personnel were encountering. Today’s Military STAR card provides a safe opportunity for troops to establish good credit as it offers lower standard interest rates than all major retailers, and most bank cards. “When troops need credit, they should shop carefully, compare offers and look for options that offer the lowest Annual Percentage Rate (APR),” says AAFES’ Commander Maj. Gen. Kathy Frost. The standard Military STAR card interest rate, on unpaid balances, is currently 9.75 percent. This rate is calculated by adding five percent to the current prime rate as set by the Federal Reserve. Deployed service members are treated under special conditions (no payments due) or have balances at reduced rates (6 percent). This compares to Kohl's private label card which charges 21 percent (18 percent for military) and Target's which currently boasts a rate of 21 percent. “Even with the pending January 1, 2005 rate increase to 10 percent, the Military STAR card still offers a great value to troops,” says Frost. According to bankrate.com, bank card variable interest rates now average 13.54%. The Military STAR credit program is specifically tailored to service members and their family’s credit needs. Its many financial benefits include a 24 hours/7 days per week online and call center account management capability; exclusive special promotions; and FREE standard shipping on Exchange Catalog and Exchange Online Store purchases at www.aafes.com. Military STAR cardholders are also not subject to over limit, late payment or annual fees which can amount to as much as 35 to 40 percent of other credit cards’ income. There is no other credit resource available to service members and their families today that can provide the level of support that the Military STAR Card currently provides. This commitment extends to contingency locations and beyond. At forward locations the Military STAR Card has proven to be an invaluable resource for deployed troops. Furthermore, since the attack on September 11, 2001, AAFES has forgiven more than $600,000 of charges in 332 Military STAR card accounts to ease the financial burden of families who have lost a service member in combat. The military encourages and promotes the responsible use of credit of any kind. Every possible effort is made to assist military members in using their credit wisely. For example, those who experience financial difficulty or have trouble making their monthly payments can contact Military STAR which will work closely with service members to resolve any potential credit problems before they arise. “Credit is a privilege that must be used responsibly” says Maj. Gen. Frost. “The Military STAR card provides a controlled environment that allows troops to learn about credit without the threat of additional charges, fees or inflated interest rates. It’s a tool for the military that every service member who chooses to use credit should use.” -- 30 -- Home
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