In a very crowded market, it is hard to know which credit card, should you decide to get one, is best for you. They all have their pros and cons, and try to seduce you with a particular offer. We look at what is available, and how to choose a credit card.
The key to choosing a credit card is to ascertain why you want one in the first place. how you intend to use the card is vital to picking the right one. If you are sure that you will simply pay off your full balance each month, incurring no interest charges, then you can ignore interest rates, and search out reward cards. You want something back from using a credit card, otherwise it serves little purpose. Thus you want to get cashback rewards on your purchases, and you should browse the market for such deals.
If you know that there will be outstanding balances on your card every month, then you need to look at interest charges very carefully. If you are starting from scratch with a new card, and will be building up a balance over the coming months, then you want a card that offers 0% interest for an introductory period. This gives you more time to pay off what you owe without incurring charges. The vital thing to remember is that this offer period WILL end, Ensure you have paid off your balance before the high interest rates kick in, or if you can’t consider transferring your balance when that time arrives. When deciding how to choose a credit card, this is important.
If you need to move debt then the offer you require is a lender offering free interest on balance transfers. There will always be a flat fee for such an offer, usually a percentage of the amount being moved. Work out which offer is best for you. Often it is worth taking the hit of that fee if it means avoiding interest charges in the near future. Again, do the maths and work out if it saves you money, and avoid the time at which the interest shoots back up. The more money you transfer that is accruing interest charges, the better these offers tend to be for you personally.
The best credit cards tend to require good credit scores. If your score is not optimal, your options are limited. Lenders will still accept you much of the time, but the rates they offer may be inferior to what others get. Also, if you have less than 5 years of credit history, you’ll have to lower your expectations of what you’ll get in terms of rewards, and you might also prepare to pay an annual fee.