There are numerous credit cards available on the market today. Rewards cards, secured cards, miles cards… the list is too long to name.
How can you choose which credit card is right for you? This helpful guide will examine the questions you should ask yourself and what the answers to those questions mean for you.
Do I have any credit history? Is my credit not so good?
If you haven’t ever had a credit card yet or your credit history isn’t very good thanks to a bankruptcy, a foreclosure, or just mounting debt from medical bills, then you need to work on rebuilding your credit. One of the most effective ways to do this is by using a secured credit card. In essence, it’s a pre-paid card where you put down a deposit of money, spend it, and then repeat.
Will I pay off my credit card every month?
If you have the ability to pay off your credit card monthly, then you should pursue some type of rewards card. From cash back on each purchase to reward points that you can redeem for goods and services, rewards cards help make your money stretch even further.
Do I plan on carrying a balance on my credit card?
If you are planning a big ticket purchase or want to consolidate some of your unsecured debt, like medical bills, into one location, then a credit card with a low annual APR makes sense for you. This will help you keep your accounts current, your payments affordable, and let you better manage the debt that you need to carry right now.
Do I have a lot of debt that I need to manage?
If you’re carrying a lot of debt on one credit card that has a high APR, then it makes sense to pursue a credit card that offers a balance transfer option. Even if you still carry two balances, you’ll pay less for awhile on the transferred balance and that can help you out of a budgetary crisis for awhile.
Do I plan on traveling a lot?
If you like to travel or your job requires you to travel a lot, then a credit card that offers airline miles as a reward may be the right choice. Purchases end up going toward the travel expenses of your upcoming vacation, whenever it might be, and the savings that you experience can help you visit places you normally wouldn’t go.
Do I have a limited income right now?
If you aren’t making much money right now, for whatever reason, then there’s a good chance you won’t be approved for a credit card. If you are, however, you’ll want to look for credit cards that allow you to skip a monthly payment or other debt management solutions that work with your limited income.
Finding the right credit card can literally mean the difference between a strong financial future or one that is near ruin. Use these tips to select the best credit card that fits your needs so that your credit score can be constantly building!