How to Choose the Best Credit Card for You
There are many factors to keep in mind during the process of finding the perfect credit card for your needs. Credit card companies will try to lure you into going with their card by using airline miles, low interest rates, no interest rates, cash back, and countless other incentives. But if the card isn’t in your best interest you will only find yourself paying more than you should for less than you need.
Consider the following factors when narrowing down your credit card choices.
1) Personal credit history. This is probably the most important as it will affect everything from your ability to get a credit card to the amount of interest you will pay and the credit limit that will be extended to you as a consumer. The better your credit the better treatment you should expect from the credit card companies. At the same time if your credit isn’t up to standard you may find yourself begging for credit scraps among limited possibilities.
2) Personal spending habits. By knowing how you intend to use your credit card you can make better choices about the type of credit card that will best suit your needs. If you have plans, as well as the means to pay off the balance that is due on your card each month you might want to opt for a credit card that offers rewards. The interest rate on these types of cards is typically higher, but if you are clearing your account each month by paying the balance in full you won’t be subject to those high interest rates.
On the other hand, if you are only going to pay a small payment each month towards the balance you might find that a standard credit card is going to be your best option as it will require the lowest finance charges over time.
3) Personal Interests. Believe it or not, if you have specific interest that rewards programs address you might find that you are actually doing yourself a favor by signing up for these cards and the rewards they offer. You will typically find cards that offer two specific types of rewards: shopping and traveling. If you are passionate about either of these and spend a good deal of personal time and money on them you might find that the rewards offered by the credit card companies really are worth the higher interest rates, especially if you aren’t carrying a huge balance each month.
Another way you can make these points work for you is to make judicious use of double or triple points that are offered. MasterCard offers double points for gas and grocery purchases, which is great if cash back is the reward of choice for you. Just use this card solely for the purpose of putting gas in your vehicles and pay the balance each month. By doing this, you’ll avoid costly interest charges while maximizing the rewards your card offers.
You should also read the fine print when it comes to interest rates, annual fees, and any other fees that may be involved in using a credit card. If you plan to use your card for cash advances, choose a card that doesn’t have prohibitive fees attached to that feature (almost all credit cards will have some sort of fee attached to cash advances, some are simply easier to swallow than others).
Most importantly think ahead when choosing a credit card. Does the card you are considering offer any sort of benefits that encourage you to grow with them as a company? Do they offer identity theft protection or online spending protection? Do they offer benefits that appeal to you?
Take the time before you sign on with a particular credit card company to find a card that will suit your needs in a credit card and plan to stick with that particular card for a little while as you establish a solid credit history. How long you maintain a credit card account is often considered as you apply for additional credit later in life. Choose a card that you feel certain you can live with for a while and you are on your way to beginning a healthy credit history.
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