If you’re looking for a credit card, you might be wondering how to choose the right one, especially if you’re looking for the best deal on rewards or you’re trying to avoid fees.
Choosing the right credit card is important because it can save you money. Plus, you’ll likely keep your card for several years into the future, so it’s a good idea to choose one you’ll enjoy having.
Here are a few things you’ll want to investigate when choosing the right credit card.
Be Aware of Fees & Penalties
Annual fees aren’t always a bad thing, but you’ll want to determine your needs first and look for the right card.
For instance, if a card offers amazing mileage rewards you’d pay for anyway because you travel a lot, you may want to opt for paying the annual fee. However, if you hate fees, go for the “no annual fee” cards instead.
Also watch for other fees and penalties. Some cards have foreign transaction and balance transfer fees, and others don’t.
Check Out the Rewards and Benefits
Credit card companies make money every time you use the card, so they tend to stack on the benefits and rewards to entice you.
Here’s a list of useful features credit cards may offer:
- Quarterly rewards. Credit cards may give up to 5% cash back on purchases from restaurants, gas stations, grocery stores and more.
- Rewards for everyday spending. Many cards will give you 1% or 2% cash back on purchases you’d make anyway.
- Mileage. If you have a travel rewards card, they’ll give you mileage and perks for airline tickets, in-flight service and upgrades on your trip.
- Travel insurance. If you like to travel, you should look for a card that covers trips. Many cards offer reimbursement for delays, cancellations and loss of luggage.
- Rental car coverage. A credit card that insures you against accidents in your rental car will be helpful because it gives you peace of mind. It will also save you money when you’re at the rental car counter because you won’t need their costly insurance coverage.
Look for Sign Up Bonuses
Several credit card companies will give you generous rewards for opening an account. They may offer a higher percentage on cash back rewards or thousands of miles to start out with.
Also watch for cards that give you a 0% APR on purchases and balances for the first year. A feature like that could help you save money while you pay down debt.
Check Out your Annual Percentage Rate (APR)
Lenders will usually look at your credit when determining your interest rate, but many cards will tell you the APR before you apply.
For that reason, try to research and choose a card that is likely to accept you, but also give you the lowest rate possible.
If you have good credit, don’t apply for a high-interest-rate card. Instead, look for a card that will give you the low interest rate you deserve.
However, if you only have fair credit, you’ll have limited options when it comes to interest rates.
Getting the right credit card can help you save money, take free trips, and so much more. To shop for the best card, look for fees, penalties, rewards, benefits, sign up bonuses and APRs. If you want more credit advice to help you achieve financial success, schedule a free consultation or become a member today.
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