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Help! - Which Credit Card Should I Get?

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Published: 07May2010
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For a first time credit card holder, choosing from hundreds of cards in the market can be confusing. If you'll base your decision from marketing ads alone, it's easy to be misled since all marketing campaigns highlight only the best that credit cards have to offer. So how do you know which is the right one to apply for? Here are comparisons you'll want to check on before making your final choice:

The rate of APR. The annual percentage rate will be divided in 12 months which will be the interest added to your balance. If you can't guarantee that you can pay off your monthly balance completely at all times, look for a low APR credit card. This way, even if you have to carry your balance for the next month, the interest will not be too high.

The annual fee. The best credit cards are ones that don't require an annual fee. Some credit cards with low APR do have high annual fees. Since no annual fee credit cards often come with a considerable interest, the best thing to do is to always pay off your monthly balance in full so that even if the interest is somewhat costly, it will not be charged to you.

The interest on balance transfers. Keep in mind that purchases and balance transfers are two different transactions. If you want to move your balances from a high-interest credit card to a low-rate card, take advantage of ones that offer 0% interest on balance transfers.

Although these may only be for a limited time, you can use it to pay off your debts minus the interest. The bottom line is being able to repay all your balance before the introductory period expires. To buy more time, find a credit card that offers a longer promo period.

Transaction fees. Usually, credit cards double as debit cards but not without a catch. It isn't recommended to use credit cards for cash advances since they usually charge you with interest right away. Some may even include additional costs such as transactions fees and cash advance charges that can bloat your charges unnecessarily. When choosing a credit card, don't forget to check on these terms.

The Grace Period. It's important to get a credit card with a reasonable grace period since it will give you more time to pay your balance in time and avoid incurring the interest rate. A 30-day grace period is reasonable enough for you to come up with your payment.

The rewards. Some credit cards have excellent rates and charges but with poor rewards programs. While some do have excellent reward programs, these often are accompanied by high interest rates and charges. For this reason, you'll want to weigh your options very carefully.

If you choose a credit card because of it promising reward program, you have to be more careful about submitting your payments to avoid incurring high interest. Some reward credit cards may even disqualify you from receiving your rewards if you're not timely with your payments. Also, make sure that the type of reward system you'll choose will match your lifestyle and credit card use.

New Horizon Business Services, Inc NHBS, Inc has been providing consumers and business owners with financing since 1989. Join our mailing list for Free Tips on Rebuilding and Repairing Credit. Click here for the list of bad credit credit cards.

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