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Choosing a new credit card may seem like an easy task at first, but it can actually be really difficult. Credit card compare opportunities are available all over the web and there are a vast number of different credit cards from hundreds of different providers. How on earth do you narrow down your choices to find the right credit card for you?
To make things simpler, you need to narrow your search parameters. Make like easier for yourself by focusing on these four main criteria:
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APR
This stands for Annual Percentage Rate, and it tells you how much you can expect a particular card to cost you over the course of a year. It includes the interest rate on the card, plus any associated fees and costs. You should bear in mind that some credit card companies offer introductory APRs that go up after a certain period ends. Others may have higher APRs for different types of transactions (i.e. one rate for purchases and another for cash advances). You should be looking to choose the lowest APR, unless you are confident you can clear your balance in full each month.
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Fees and charges
Most credit cards come with a list of fees and charges, which apply to everything from using your card to get a cash advance to using your card in a foreign country. There will also be charges for paying late or missing payments. You should think about how you intend to use your credit card and find out what charges you may have to pay.
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Credit limits
All credit cards come with a credit limit, which is the maximum amount you can spend on it. If you have a high credit rating, you might be able to get a greater credit limit. However, a big credit limit could lead you into debt-related trouble. On the other hand, a tiny credit limit could render your credit card next to useless.
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Bonuses and benefits
These days, many credit cards offer bonuses, benefits and rewards, such as cashback, frequent flyer miles or loyalty points every time you spend. These cards can really help you get the most from your spending, but don’t let bonuses and rewards be the deciding factor for picking a particular credit card. It may be the case that to get certain rewards, you have to spend more than you can afford to repay. You should only choose a rewards card if it suits your needs overall.
Beeb says
Fees are definitely a big one to consider.