Your Guide On Choosing a Credit Card To Suit
You
Reach
into your wallet or purse, pull out a card, swipe, and
you’re done. It is very easy to use a credit card.
The problem lies in choosing a card – and it has
nothing to do with the picture on the front! Choosing
a credit card that works best for you is vital to your
credit rating. If you choose incorrectly, you may find
yourself in deep debt trouble. Here is some basic, yet
extremely important, information that will help you make
the right choice.
Your
Money Handling Habits
Choosing a credit
card that is perfect for one person may be a dismal failure
for you because your habits are different. When it comes
to choosing your credit card, you need to look very closely
and honestly at your habits.
For
instance, do you typically carry a balance or do you pay
off the card at the end of each month? If you answered
“yes” then you will need to shop for:
-
A low Annual Percentage Rate (APR). The APR the interest
rate you will pay on any outstanding balances each month.
The higher the rate, the more you will pay in interest
charges.
- A
fixed-low rate. This means that they will guarantee
that your rate will stay low. Oftentimes, a company
will offer a low introductory rate to get you signed
up and then increase the rates drastically in 3, 6,
or 9 months. The problem with a guaranteed rate is that
an annual fee often accompanies it. You will need to
decide if the lower interest rate guarantee is worth
the cost of the annual fee.
If
you will be paying off your card at the end of each month,
you will not have to worry as much about a low APR since
you will not be using it. And with no need for a guarantee,
you may be able to avoid yearly fees. However, you will
want to be sure to get a card with a grace period.
- Grace
Period: Be careful to get a card that allows you to
pay off your bill at the end of the month with no finance
charges. Those that don’t offer the standard grace
period begin charging you interest the moment you make
a purchase.
- Cash
Advance Fees: Be aware that most cards charge interest,
and sometimes at a higher rate, for cash advances and
this charge begins with no grace period even if your
card offers a grace period for purchases.
You
also need to decide how reliable you will be when it comes
to paying on time and keeping yourself under the card
limit. If you are often late paying your bills or often
do not know how much credit you have left, you will want
to watch out for transaction fees and other charges. Many
card companies charge a late fee and an over-the-limit
fee. These can be substantial. Your best bet is to pay
on time and keep under the limit, however, finding a card
with lower charges is a good idea.
Here
is another important question to consider when looking
at your money handling habits: Do you use the card rarely,
occasionally, regularly, or frequently? Those that use
their cards for just about everything instead of using
cash or checks will want to look for credit card protection.
This way, if you lose your card or it is stolen, you will
not be responsible for any purchases made.
Finally,
consider the different benefit programs that cards are
offering.
- Do
you travel? Then consider a card with frequent travel
miles as a reward. Or perhaps one that offers traveler’s
insurance.
- Do
you use your card for large purchases like electronics?
You may want to consider credit card insurance that
will replace your equipment for a specified period of
time if it breaks down or gets stolen.
- Are
you saving to buy a new car? There are cards that offer
new car rebates.
- Do
you have a favorite charity? Many cards now support
specific charities, universities, and organizations
by paying the entity a specific amount with each purchase
you make.
What
matters most is to find the features that fit your pattern
of spending and paying. Don’t get fooled by the
gimmicks or the advertisements. Know your spending habits,
look at the small print, and choose the card that is best
for you. With all the different cards available, you will
be able to find the right fit for you.
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Wesley Atkins is the owner of http://www.credit-cards-advisor.com-
which aims to get you fitted with the best
credit cards to suit your situation. With numerous
credit card articles
and easy online
credit card applications you will never choose the
wrong credit card again.
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