Choosing the right credit card that suits your lifestyle is like choosing your life partner: you want it to complement you and help ease your burden. With so many types of credit cards to choose from, how can you tell which one is the right one for you? Depending on your lifestyle and financial situations, certain types of credit cards would benefit you more than the others. Before you start sending an application for a credit card, be sure to do some research and consider these five important things:
1. Credit limit
The best credit card should give you a reasonable credit limit while allowing some flexibility when you need to exceed it in times of emergency, while leaving no room for you to overspend. If you’re the responsible type (with a stable full-time job or high income), you may choose a card with higher credit limit. Otherwise, stick to credit cards with lower credit limit to avoid getting yourself stuck in a financial burden.
The wonderful rewards program is one of the greatest benefits to having credit cards. With rewards points earned every time you make a purchase, you’re able to apply them toward cash back, retail purchases, travel, and other things. To earn the most points, make sure you choose a credit card that will reward you on things which you’ll spend the most on, such as clothes, groceries, petrol, etc. Another strategy to get the most points possible is picking a credit card which gives reward when you use it in places you shop the most at, like select boutiques or online stores. Remember to spend only on necessary things, and don’t make purchases for the sake of earning rewards points.
3. The cost of owning and keeping the credit card
Before you decide on a card, make sure to read the fine print. The more amazing benefits a card offers, the more you’ll spend on fees. Some of the fees to look out for include the annual fee and foreign transaction fees. An annual fee normally offers greater rewards, like more savings while you travel. Cards with foreign transaction fees will charge you more if you use it abroad. You can always avoid paying more by choosing a card with no foreign transaction fees.
4. Customer service
If you’re going to use your card often, you need to be able to reach customer service any time you need them. Your credit card company should have a good customer service ready at your beck and call in case bad things, like fraudulent charges, happen. You also need to be able to speak to a staff who’s trustworthy, competent and helpful. Avoid credit card companies with minimal human interaction, automated phone service, or difficult-to-navigate websites.
5. Annual percentage rate (APR)
The APR is an interest rate that you’re required to pay when you didn’t pay your balance in full. Make sure your card has lower APR rate that you can manage. Try to stay ahead of your balance to avoid extra charges.
When you’ve taken all of the important factors into account, you can start to apply for a credit card online for convenience and speed. As a rule of thumb, always look for a credit card that meets your needs the most, with the greatest rewards. If a credit card of your choice has terms and conditions that you think you’re unable to meet, look for the next best thing. You don’t have to compromise, but you do have to be able to pay the bills. Also, remember to stay on top of your monthly bills and try not to miss any payment to avoid incurring more fees.