The following article is designed as a general guide to choosing a credit card. It is not a definitive guide but more an introduction into what you should look for in order to choose a credit card that is right for you.
Choose a Credit Card to Suit You
When choosing a credit card you need to understand that there is no such thing as a magic credit card designed to meet all your credit needs. Many credit card suppliers will claim that their card is the answer to all your credit concerns.
There are quite literally hundreds of different credit cards available to you in the consumer credit card market. With so much choice it is important that you focus on the right one for your personal financial situation: and this is dependent upon how you intend to use your credit card.
Credit Card Balance Transfers
For many people who have debt on existing credit card the opportunity to transfer the balance to another card which has either a lower interest rate or a specified introductory balance transfer period can offer a significant financial saving.
In credit card balance transfers, the provider of your new credit card settles the debt on your existing credit card, transferring the debt to your new card. Many credit card suppliers offer an introductory interest-free rate period for balance transfers which literally means you pay nothing over and above the value of the debt for the specified interest-free period. This gives you an opportunity to clear your credit card debt quicker.
Choosing to Pay Your Credit Card Balance in Full Each Month
If you’re the type of person who chooses to pay their credit card balance in full at the end of each month you will most likely not to feel the pain of interest charges. If you believe that you will continue to be in a position to repay your credit card balance at the end of each month you may like to choose a credit card that offers you some type of loyalty reward or cashback for every purchase you make with your credit card.
Choosing to Carry Your Credit Card Balance Over Each Month
If you’re the sort of person who does not settle their credit card balance in full at the end of each month you will likely incur interest charges on the balance of your credit card debt. If this is how you regularly use your credit card you might like to choose a credit card with the lowest standard rate of interest that you can find.
A Note on Credit Card APR
APR (annual percentage rate) is the amount that you will be charged in real terms for any money that you borrow with the credit card you have chosen, assuming you do not pay your credit card balance in full each month. The most important figure you should consider is the standard APR as this is the rate of interest that you will be charged when your specified introductory credit card rate passes. Always be certain that you understand the difference between the introductory rate offered and the standard rate that kicks in after the introductory period expires before you choose the credit card you will end up with.