Credit cards are beneficial for every individual in that they can help to build one’s credit, stretch your funds when cash flow is tight, travel without the risk of carrying cash and track your business expenses. Other people also use credit cards to make day to day purchases household goods, clothing, or school supplies with an honorable mention to online purchases. Actually, you need a credit card or a debit card in order to make online purchases. Before getting a credit card, you need to determine which one is the best for you.
You can determine the credit card offers you qualify for by first checking on your credit score. If you have a higher credit score, you have a better chance of eligibility for cards with great benefits. You can check your credit card scores from credit bureaus or credit card issuers.
Next, you need to find out the exact kind of credit card you need among the three main types namely:
1) Credit cards which earn rewards
2) Credit cards which save money on interest
3) Credit cards which can improve one’s credit if it is damaged or limited
The ideal credit card for you is that which has designated features to meet your exact requirements.
A rewards credit card is great for you if you never incur any interest and fully pay off your credit card balance on a monthly basis. Such cards often have higher Annual percentage rates but they offer you cash back, miles, or points on every coin you spend in addition to providing bigger sign-up bonuses.
A balance transfer, 0% APR, or low-interest credit card is ideal for anyone planning to use his or her credit card in the event of any emergency or anyone with an irregular income and carrying a balance occasionally. A credit card with a balance transfer offer can help you pay off any high-interest debt you have without paying any interest. Take note that such offers might be more difficult to get if one has poor or average credit hence the importance of finding out your credit score before-hand.
Unsecured cards or student credit cards are ideal for college students who are still new to the concept of credit as it is much easier to qualify for these cards in comparison to other kinds of credit cards. Secured credit cards are also quite difficult to qualify for as generally, you need to have a security deposit amounting to $200 or more. The deposit will be returned to the customer when the account is closed in good faith or upgraded.
It is easy to narrow your choices to find the best card for you but it can be quite hard to decide between two or three cards that are more or less the same. You can break the tie by evaluating all your credit card choices for differentiating factors such as the ones below.
Cash-back/Travel or Rewards Credit Cards
– There is no expiry date on the rewards provided and on some cards you can take advantage of the rewards as long as the card is open.
– They have a lower spending requirement meaning you do not need to spend too much to be deemed eligible for a sign-up bonus
Balance Transfer or Low-Interest Credit Cards
– There is no penalty APR or late fees as some credit cards will waive these charges and this can be helpful if you are falling back on payments.
– They offer a debt payoff planner which can also be helpful when you have a lot of debt to pay off.
Secured and Student Cards
– Some secured credit cards can put your security deposit in a card that earns interest so you earn some money on it
– Some of these cards allow you to increase the credit limit automatically following several punctual payments.