How to Choose the Right Credit Card for Your Needs

Since not everyone is financially in the same place in their lives, no one credit card is right for everyone. Someone trying to reduce their debt will need one card, while someone without debt can benefit from reward points. Credit is needed for our everyday lives, but restraint and self-discipline are necessary to use it properly.

Difficulty: Moderately Easy

Instructions

Things You'll Need:

• Internet connection for research
• Self-discipline

1. ZERO OR LOW INTEREST RATE CARDS
   
   This card is the best for someone in the process of paying off credit card debt. Since these low rates are usually only for 6 to 9 months, this is a detail that needs to be looked into and monitored closely. If your debt is not paid off in that period of time, you will need to either move to a new low interest rate card or negotiate a new lower rate with the current card.
   
   For a current listing of the cards with the lowest interest rates see Additional Resources below, link #1.

2. REWARDS CARDS
   
   This card is best for someone who is able to pay off the full balance at the end of each month. With this type of card you can earn Gift Certificates, Cash Back, Airline Flights, Hotel Stays, etc. Care should be taken in this type of card to ensure that the rewards you will be earning are something that you will really be able to use. Additionally, these cards typically have high interest rates and may have fees. You will need to make sure this is a good deal for you, given these details. Personally, I don't care for any card that requires a fee.
   
   To research the card that is best for you see Additional Resources below, link #1.

3. SECURED CARDS
   
   This type of card is for someone that has had credit issues in the past and is trying to re-build their credit rating. The downside to this type of card is that they will require about a $200 deposit, and may have high interest rates and fees. The fine print needs to be read carefully.
   
   To research the best card for you see Additional Resources below, link #1.

4. STUDENT CARDS
   
   This card is for responsible college students. They can easily qualify for this card, and build their credit rating. Care should be taken to possible high interest rates, and the use of the card by inexperienced people. The student can just as easily end up with major credit issues as a good credit rating, if used irresponsibly.
   
   To find a student card with the best rate see Additional Resources below, link #1.

Tips & Warnings

• Carefully monitoring your statements will allow you to know exactly where your money is going. This is valuable information to reduce un-needed expenses, and also to identify and manage un-planned expenses.
• Always pay your bill on time, even if there in an emergency in which you are not able to pay the full amount. These bad marks on your credit rating can even raise your insurance premiums.
• Never spend more than you can afford, just because you have a credit card. You are in control of your cards, don't let them take control of you.
• Always pay attention to the fine print, including any fees.

Resources

• BankRate.com - Credit Card Research
• Frugal Patti - Frugal Living Tips

[klnygaard]

on 11/4/2008 good info on credit cards

[HairCrazy]

on 11/3/2008 Great tips on credit cards. Thanks

[JulieMayfield]

on 11/3/2008 Excellent article. Thanks for sharing.