What to consider when choosing a credit card
Posted by hecto on March 8, 2009 under Credit Cards, Finance | 
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The credit card market is a wide and diverse one, with many options for the consumer to choose from. It is important that you are able to choose a credit card that best reflects what you want to do with it – your lifestyle, the uses you envisage and the credit limits that you need. The credit card needs to suit you.
So before considering a credit card you need to take a look at what usage you envisage for it, why you need a credit card at all. There are many reasons for using a credit card, and each reason has an effect on which card you choose at the end. Perhaps you want it simply to get cashback on purchases and will clear the total amount every month, maybe you have a specific purchase in mind or want it for emergencies. Whatever your thoughts it is important that you consider what you need from the credit card before you look at your options.
Interest
The APR (annual percentage rate) is possibly the main feature you have to look at when considering credit cards. If you are planning on paying off your entire months bill every month you should be looking for a card that offers 0% APR on new purchases to ensure that you are never paying out money that you don’t have to, but the main APR is less important. However if you are considering making purchases on the credit card that you will be spreading out over time a low APR card is vital as you will be accruing interest every month, and the less interest the better – no one wants to pay more money than they have to!
Credit Limits
Consider what you will be using the credit card to buy. Are you looking at high priced items that you are looking to spread the cost of, in which case a high credit limit is essential. Or are you just looking for a credit card to use in an emergency, in which case a lower limit that can help you resist using it for other uses would help.
Your credit limit is determined by outside factors than the credit card company themselves, factors such as your credit score and you income. But the amount of credit offered by a credit card company will still vary from card to card so it is worth shopping around for one that best suits you.
Incentives
One major growth area in the credit card market is balance transfers, and if you have a good credit rating and existing credit card you can get some great deals. Various companies are offering deals such as cash incentives for anyone moving their balance from one credit card to theirs, others offer 0% APR, or other incentives. Whilst it shouldn’t be a main priority it is an aspect of credit card choosing that is certainly worth bearing in mind.
It is not just balance transfers that offer great incentives. Now many credit cards offer them to new customers, or even as a matter of course for the credit cards everyday use. When you consider offers such as getting 1% cash back or air miles think of how you will be using the card. Will you be paying for a lot of items with it? If so you can make some real savings even with just 1% cash back, or get a great holiday from the airmiles.
As you can see researching which credit card is right for you is vital There are many options to consider and many aspects that can change which is the credit card that best suits your uses. One thing is for certain though, credit cards are playing any increasingly important role in our society, and having one can provide huge benefits.
