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Consider Your Credit Card Budgeting Habits First
Television ads entice you with carefree lifestyles with a credit card.
Sales letters flatter you with pre-approved applications and tropical island destinations.
However, is this really how you should choose a credit card?
Someone who pays the balance in full every month is looking for entirely different features than someone who carries a balance, and is looking to reduce their interest charges.
If you carry a balance, interest rates and fees are most important.
Find a credit card with a low interest rate, and keep in mind that an annual fee is not automatically a deterrent.
Read the Small Print About the Credit Card and Look Beyond the Brand Name Credit Card
They look beyond the big bold letters advertising the interest rate and study the disclosure agreement.
And, if you are doing a cash advance or balance transfer, how do those policies differ from that of a purchase?
Be especially alert for policies that punish certain actions.
Will one late payment throw you into a much higher rate cycle?
The disclosure agreement is more important than the annual percentage rate (APR).
Look at day-to-day procedures.
What kind of billing cycle do they have?
How much of a grace period do you have to get the payment in?
Compare the Perks of a Good Credit Card
Rewards and rebates really only benefit those who pay the balance in full every month.
If you're carrying a balance, you should not be looking at these types of credit cards.
Remember that rewards are not confined to frequent flyer miles or cash back anymore, so shop around.
Other differences in credit card features include insurance and warranties.
Again, check the fine print for protection against rental car damage and flawed merchandise.
It varies from credit card to credit card.
If there's something of value to you, make it a point to investigate the specifics of it.
As long as the other terms are similar, the name on the credit card doesn't make a difference.
MasterCard and Visa are credit card networks that license individual banks to issue cards.
Discover is both a network and a credit card issuer.
You have to pay your bill in full every month, although they are beginning to add some credit options.
It's the terms that really matter when you're comparison-shopping for a credit card.
Things such as interest rate, fees, grace period, and perks earned on rebate or reward cards.
Tired of the debt lifestyle?
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