Many people who want to apply for a new credit card wonder which card they should choose. With a number of different types of cards available, it is wise to gather information and weigh all your options to help you decide which card is right for you.
Here are a few of the most common types you will encounter:
- Credit Cards With Rewards
One very popular category of credit card is rewards credit cards. These types of cards offer users spending incentives such as cash back, travel perks and other freebies. Most of these cards are tailored to offer specific rewards such as dining certificated or plane tickets, while a few issue generic points per dollar spent which can be redeemed for cash, services or merchandise.
Two things to watch out for with rewards credit cards are that they often have an annual fee and a higher APR than non-rewards cards. If you intend to revolve a balance from month to month the amount of interest you accrue might outweigh any rewards benefits.
If you are a business powner, you may want to consider getting a business credit card no matter how big or small your business is. They come with great tools designed to help you track and manage your spending and expenses. Many also come with the option to issue multiple cards to employees so that you can also track their spending. Some business credit cards even come with rewards programs, which can avail you of some very useful perks.
- Balance Transfer Credit Cards
A balance transfer credit card is a card with a low or no interest rate onto which a debt is transferred from another card. They are great options for anyone who has a sizable chunk of outstanding debt sitting on a high interest-bearing card. In transferring the balance from the high interest card to the low interest card, you will save yourself money in interest fees while giving yourself the opportunity to make some headway in paying the debt down.
When faced with selecting a balance transfer credit card, you should always compare a number of different offers first in order to secure the best deal. The low APR offered on balance transfer credit cards are typically promotional rates offered for only a limited amount of time, so pay attention to the duration of the teaser rate. Also, there is often times a fee associated with transferring a balance, so make sure you know what it will cost you to shift your debt around prior to filling out any application forms.
For college-aged students who are interested in building their credit history, applying for a student credit card is a good way to begin establishing credit. You will need to research which companies offer special cards designed just for students that require no credit history. In general, student credit cards have low spending limits, so be sure to use your card wisely and not go overboard making charges once you get one.
There are certain benefits that are available no matter which type of credit card you choose
. These are things such as extended warranties for items you buy using the card and other purchases protections, discounts at affiliated retailers or travel insurance. Make sure that you always read the terms and conditions of your credit card agreement so you can learn everything a particular card has to offer.