A credit card is one of the most valuable tools in your wallet, and almost everyone has at least one. A credit card can help protect against identity theft and most offer cash back and a wide variety of rewards.
There are hundreds of credit cards currently available, and it can be quite overwhelming trying to decide which one to get. Of course, you can ask family and friends, but user experiences vary with each one and what might be right for them may not be right for you.
Follow these handy tips to find out how to choose the right credit card for you, and hopefully, pay it off over time.
Take a Look at Your Credit Report
It’s important to determine your credit worthiness, or at least how lenders and credit card companies see it. Knowing it will help you determine what credit cards you can apply for. You can get a free credit report once a year from annualcreditreport.com.
Perform Some Self-Analysis
Take some time to think about what you want from a credit card and how you plan to use and pay for it. Will you typically carry a balance? Are you trying to consolidate multiple debts? If so, think about a card with a low-interest rate. If possible, take advantage of introductory offers with zero percent for the first few months, but remember to check how much the interest rate will go up once the offer expires and how much the fees are for balance transfers. If you think you’ll carry a balance, take a look here to find out what habits to avoid if you want to eventually pay it off.
If you plan to pay off your balance every month, look for a no-fee credit card that offers rewards. If you will use your card a lot consider a card with a low annual fee and more valuable rewards. While most credit cards don’t have annual fee’s anymore, if you spend thousands of dollars per year on it, a fee of a hundred dollars or so probably won’t matter. This type of card is usually packed with valuable rewards such as stays in luxury hotels, celebrity meet-and-greets and early access to events and museums.
Thoroughly Weigh the Options
There are many different types of credit cards, and it’s important to understand each one to choose what’s best for you. You can find cards that offer cash back, zero percent rates and travel rewards. You can also choose store credit cards, gas cards and prepaid debit cards.
For things like limited fraud liability and rental vehicle protection, most cards offer the same protection. But you’ll notice big differences in purchase and return protection and extended warranty benefits.
Don’t Forget to Check Regular Mail
While performing some Internet research is a good idea, you shouldn’t ignore your regular mail. Many credit card companies send promotional offers via snail mail, and you should look them over before you shred them.
Take your Time
Don’t choose the first credit card you find, only to regret it later, close it and open another. Opening and closing cards too often trying to find the perfect fit for you can damage your credit score. Make sure you complete your research before deciding on a card to ensure that you’re completely happy with your decision.
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