How to Find the Right Credit Card for You

From your first student credit card that mom or dad had to co-sign for, to the ultra-exclusive American Express Black Card, available to only the most wealthy, there's a credit card out there for just about everyone. How to decide on the best one for you? Here are some tips on choosing the best credit card.

Difficulty: Moderately Easy

Instructions

1. **Check the Annual Fee**
   
   Most credit cards no longer charge annual fees, but a few do, so be sure know what you're getting in to. An annual fee may actually be worth paying, if the card offers particular benefits that closely match your needs. For the most part, though credit cards with fees are high-end cards that chiefly offer bragging rights.

2. **Watch the Interest Rate**
   
   Never mind any special introductory rates... be sure you know what the long term interest rate will be for any unpaid balances on your credit card.
   
   If you methodically pay off your bills every month without fail, then the interest rate is less of a consideration. But if you suspect you're likely to have an unpaid balance on occasion, then go for the lowest rate you can find.

3. **Be Careful With the Credit Limit**
   
   Credit cards are very variable in the initial credit limit allowed with your account. A high credit limit can be a good thing, as it offers flexibility in times of sudden financial need or for an unplanned expense.
   
   On the other hand, an oversized credit limit can be a dangerous temptation to spending more than you can reasonably afford. The ancients advised that it's wise to 'Know Thyself'. This is very good advice when it comes to credit limits... avoid high limits if you know you're going to overstretch your finances.

4. **Look for the Best Benefits**
   
   Many credit cards offer special benefits to customers based on the amount you spend each month.
   
   This may take the form of cash back on all purchases, or on a select group of purchases, such as cash back on gasoline, or office supplies. Other cards may offer airline mileage points, or special 'shopping club' type deals. Look around for the benefits that best match your interests and expense habits.
   
   Also be mindful of other benefits offered, often in the fine print. These can take the form of free car rental and travel insurance, extended warranties on purchases, shoppers' protection against theft or breakage, and other goodies. You can probably learn of these more easily by talking to an agent on the phone, rather than trying to ferret out the details on a website.

5. **Consider Card Acceptability**
   
   Not all credit cards have the same widespread acceptability. Visa and Master Card tend to be accepted by the most merchants, nationwide in the US, and internationally. American Express and Diners Club have more limited acceptability, but may offer other features worth considering.

6. Remember... don't be mislead by introductory offers that seem very attractive. It's really the long-term features that are the most important consideration.

[sha4852]

on 9/20/2009 For those that can handle paying what they owe when the bill arrives, this might be fine. But only they know who they are, they need to be wise about their decisions, not hide their purchases from anyone.

Bless,