If you will be shopping for a new credit card this year, then these tips will help you choose the best card that’s right for your credit and your spending habits.
First of all, know your credit score. When shopping for a new credit card, you want to be sure to stick to cards that are suitable for your level of credit. There are many sites online where you can shop for a credit card based on four credit categories: excellent, good, average, and bad. Applying for cards you aren’t going to qualify for, will result in needless dings to your credit score when you are denied credit.
What is your credit card balance?. If you are dealing with lingering credit card debt, then you may want to consider a card with a low-rate balance transfer offer. Getting a card with a super-low rate on balance transfers could help you save some serious cash on finance charges. Make sure to factor in the cost of balance transfer fees, typically 3-4% of the transferred balance.
If you do carry an occasional credit card balance, you may want to choose a card with the lowest annual percentage rate that fits your credit.
Check out the introductory rate. If you are planning on some big purchases this year that will take several months to pay off, then you may want to obtain a credit card that provides a rock-bottom introductory rate on new purchases. Cards with low-rate introductory periods of a year or more are readily available. That way you’ll pay next to nothing in finance charges as you pay down your balance.
Reap the rewards. If you pay off your credit card in full each month, you might want to opt for a card that has a rewards program. Today just about every kind of rewards packages are available; from gas and travel rebates, airline and hotel miles, and even cold hard cash reward cards.
Many rewards cards do not charge annual fees but some do, so be sure to consider the cost of an annual fee before signing up for a rewards card.
Find out about fees. If you’re new to credit or have damaged credit, obtaining a credit card can be a bit trickier. Many times the credit cards that are available to you will tend to have higher interest rates, and application and/or processing fees. Finding a card with reasonable fees should be your primary concern. So take a close look at a card’s annual fee, and confirm if this annual fee is charged in full your first month, or broken out over 12 months.