The number of credit card options has exploded over the past couple of decades, and with it the confusion many consumers feel. But how do you choose the best credit card for your needs, and how do you know that the card you have chosen is providing the perks you think it is?
With thousands of different credit cards to choose from, pinpointing the perfect wallet companion can be a confusing process, but fortunately there are things you can do to simplify it. Here are six smart tips to help you get the most out of your plastic.
1. If this is your first credit card, start by opening an account with the bank or credit union where you have your checking or savings account. You are more likely to be approved, and your local banker can help you use your new credit wisely.
2. Seek out the credit card with the lowest available APR until you know that you can handle the spending and pay off your bill in full. If you pay the bill in full, you will never pay a finance charge, but making that happen is easier said than done.
3. As your financial discipline improves, look for credit cards that offer perks meaningful to you. Do you love to travel? An airline credit card may be the best choice for you. Do you shop online? If so, a card that rewards you with emailed gift cards may be the best credit card for you.
4. Keep an eye out for new credit card offers, but respond only to the most compelling. Too many inquiries on your credit report could lower your score, thus making future cards harder to get.
5. Review your credit report on a regular basis. It is important to keep tabs on your use of credit, so pull a copy of your credit report at least once a year and check it carefully.
6. If you have excellent credit, you may be able to make money with your credit cards. Keep a lookout for new credit card offers, especially those with monetary bonuses, airline miles, gift cards and other perks.
The Best Credit Card Depends on Your Lifestyle
Credit is a fact of modern life, and living without a credit card can be a real challenge. However, you do not have to forgo the convenience of carrying a credit card to enjoy a financially responsible lifestyle. Focus on the best credit card that meets your current needs, and give yourself a solid financial foundation. ♦