Tips on How to Choose the Right Credit Card

 

There is no denying that a credit card is indeed an extremely and overwhelmingly useful and powerful financial tool if used properly. Aside from the fact that most people - especially in the US - find these plastic cards more convenient to carry around compared to cold cash, many of them also appreciate the consumer protection provided by the Federal Law. But, with so many companies coming out with many kinds of credit cards, it is no wonder that many people get confused and overwhelmed by the "convenience" each and every one of them offers.

 

While it is true that there is no single credit card that will fit everyone's need, it doesn't mean that consumers should just take in what these creditors offer. Since people have very diverse and different credit needs, they must be very careful in choosing the right credit card for themselves so that they could avoid credit traps. Before your credit card leads you to a path wherein you owe more than you can afford to repay, or before it damages your credit and creates trouble by careless usage, here is some information that can guide you to choose the right credit card for your own personal needs.

 

1. Identify your credit need.

 

This is the first thing you must consider in choosing a credit card. Ask yourself why you need it. Whether you need it for education, home improvement, business or for purely for convenient purchasing need, you must have a specific target where you can use your credit card wisely. And since each and every one of them have their own strategies in luring you to choose their credit card; you must clearly identify your priorities for a specific credit card.

 

In making your “needs” decision, here’s some guidelines:

 

a. First, Are You a Student?

 

If you are, then you’ll be best off with a student card – you’ll probably have trouble getting accepted for anything else. It would be best to contact the bank where you have your student account before you do anything else.

 

b. Do You Have a Balance to Transfer?

 

If you do, then you need to be looking for a card with a low APR on balance transfers – preferably one that stays low for more than a few months, unless you intend to switch often.

 

c. Are You Planning to Make New Purchases?

 

If so, then pay more attention to the APR for purchases, which is usually entirely different to the one for balance transfers. You should also look at what kind of grace period different cards offer, so you don’t end up paying interest on your purchases straight away.

 

d. Do You Pay Off Your Balance In Full Every Month?