The type of credit card you need depends on a mishmash of factors, from your income and current debt level to your spending habits, social affiliations and professional memberships. Before selecting a card, make sure you understand things like benefits, terms and conditions, annual percentage rate and annual membership fees. Credit cards run the gamut from standard and rewards program to frequent flyer, specialty and credit repair.
Do I Need a Standard Card?
Most people have a standard card, that is, the type of unsecured card with a basic annual percentage rate. Most financial institutions offer this type of card, and the majority of consumers with a FICO score above 640 typically would receive one if they sign up for it. A standard card may be the one you need if you regularly pay off your card balances, live within your means, don't travel much and need to build up your credit history.
There are two types of standard card: low-interest and balance transfer. A low-interest card may be suitable for you if you have a high credit score and are in good financial condition, among other things. Creditcards.com enables consumers to search, compare and apply for low-interest cards. A balance transfer card can help you lower interest charges from higher-rate cards. Before transferring balances, read closely the fine prints and ask your credit card institution for more information. The goal is to avoid those teaser rates that initially are low when you make the transfer but skyrocket after the introductory period, say, six or 12 months later.
Is a Credit Card with a Rewards Program Right for Me?
With a reward card, you earn incentives whenever you make a purchase. So the more you spend, the more rewards you accumulate. Reward cards are as varied as general reward points, cash back, hotel or travel points, retail rewards, and gas cards with points or rewards. This kind of credit card is right for you if your lifestyle, spending habit, profession or entrepreneurial ambition fits with what the card offers. For example, if you own a shipping company, you might find a gas card suitable for your business, especially when it comes to lowering your business' overall gas expense. Alternatively, if your job requires that you spend, say, more than 50% of your time at hotels and other lodging facilities, holding a hotel points card may be a smart decision.
Why Would I Need a Frequent Flyer Credit Card?
If you fall in the frequent flyer category, you might want to consider a travel rewards card, which is a subset of the rewards cards but one that is specifically aimed at people who regularly travel, be it for business or pleasure. You may want to consider cards that are co-branded with a specific airline, say, United Airlines credit cards, or are generic, meaning you can redeem the benefits through any airline. Talk to your airline or travel agent to learn more about frequent flyer programs and ways you gradually can increase mileage awards, accumulate benefits over time, and finally afford that trip to the Bahamas you've dreamed of all your life.
What Benefits Can I Derive From Specialty Cards?
You would want to consider specialty if you're a consumer with specific needs, such as students or businesspeople. Business cards are available for entrepreneurs and business executives and offer everything from low introductory rates and travel rewards programs to cash back programs. If you fall in that category, talk to your bank and see what kind of business cards it offers, especially when it comes to perks like high credit limits, cards for employees, expense management reports and special business rewards and savings. If you're a student, getting a student credit card can help you build up your credit, which is a good thing given that most financial institutions may not readily grant traditional credit cards to youngsters who are still in college and lack creditworthiness.
How Can Bad-Credit or Credit-Repair Cards Help Me?
If your credit score has been tarnished because of financial mismanagement or a series of bad personal choices, you still can hold a credit card. Talk to your financial institution to learn more about the type of bad-credit card it offers as well as the terms and conditions. Check CreditNet to find your perfect credit card, especially one that suits your subpar credit score and credit level. Before selecting a card that fits your personal profile, you can read experts' reviews and compare the best cards on the market. The goal here is to use credit responsibly to rebuild credit and creditworthiness quickly.
The type of card that suits your spending should also fit nicely with other aspects of your life, such as profession, financial condition and creditworthiness. Depending on your personal situation, you can choose from a wide assortment of cards, ranging from bad credit and specialty to standard and travel-related.