Choosing the Right Credit Card? Consider These 10 Factors

I had previously wrote about how not to use credit card and how to handle a credit card. Here, I’ll talk about the pre-application process. Choosing the right credit card. When you decide to apply, what steps you should ideally follow to get best credit card? Or, how to get the best credit card is the topic today.

In today’s society credit card is becoming essential in our day-to-day life. It not only makes you lighter in your pocket, but also you have access to emergency money, whenever you need. Often credit cards can give you preferential treatment, specially at the airports. Lastly, the lure of rewards, if you can pay the full balance off every month. Wise use of credit cards increases your credit score and credit worthiness.

But, unfortunately not everyone is capable of handling credit cards and related financial responsibility. Having a credit card will help you to keep your finances in order (all transactions are logged, you don’t have to scratch your head about that $10 bill that is not in your wallet anymore) and, achieve better credit rating.

For convenience of everyday life and fast pace of living standard today, you may act on getting a credit card, even if you never had the urge of having one in the past. And, your quest should be to grab the best credit card fitting to your need.

Do not forget to go through this excellent consumer guide to credit cards, right from the folks at federal reserve, before you apply. The guide teaches how to read credit card offer documents and to understand card statements.

What Should be Considered When Applying for a Credit Card

1)  Acceptability:  The very first thing that needs to be considered when choosing a credit card is the global acceptance of the card in question.  Major credit card companies such as Visa, MasterCard and American Express are generally accepted across international community.  Choosing a credit card with limited capabilities will also limit the number of places you can use it.  Select a credit card that will be useful to you under all circumstances and in any place.

2)  Reputation:  The reputation of the credit card company is always a worthy consideration.  Established credit card companies have a very respectable reputation since their livelihood depends on living up to the expectations of their customers.  If a credit card company doesn’t have an established reputation of being trustworthy, it isn’t worth applying for.

3)  Annual Percentage Rates:  Credit card companies are in the business of making money.  This is accomplished through the assessment of finance charges.  These charges are calculated based on how much of the available line of credit has been used, how much is still owed to the credit card company resulting from the purchase of products and the unpaid balance and is usually based on a percentage of this figure.  Choosing a credit card company with lower annual percentage rates based on your financial statistics will save you money in the long run.

4)  Individual Responsibility:  If you are experiencing difficulty handling your finances right now, then having a credit card is only going to compound the problem.  You cannot alleviate existing financial stress by getting a credit card to pay off bills.  The addition of the annual percentage rate applied to the charges made against the card will only add to the amount of money you owe and serve to complicate matters further.  You have to exercise financial responsibility when you have a credit card otherwise you are headed for disaster.

5)  Advantages of Having a Credit Card:  Modern society dictates the use of modern technology in order to survive in the modern era.  The majority of business conducted internationally on a daily basis, is done so with a credit card.  Several businesses require a credit card in order to make a reservation, even if the individual making the reservation intends to pay for the service in cash once they arrive.

6)  Opportunities:  Credit cards provide the opportunity to make purchases that would otherwise be impossible.  People don’t always carry enough cash with them, nor do they always remember to bring along the checkbook to cover the cost of a purchase, having a credit card in these situations will allow the purchase to be made without hassle.

7)  Affordability:  Credit cards allow for the purchase of products and services that wouldn’t ordinarily be available due to the lack of sufficient personal finances.  Using a credit card to make such a purchase allows the luxury of enjoying that feature without having to develop a savings plan to buy the product or service.

8)  Card Member Services: Most major credit card companies offer additional services for their card carrying members.  Take a look at the services that are offered by the company providing the credit card and determine if they will be helpful to you.  They may all offer similar services but the fine print is where the details are revealed, read all the information available before making a decision.

9)  Customer Satisfaction:  This is a very important consideration for anyone thinking of getting a credit card.  If the company providing the credit card doesn’t have a remarkable Customer Service Call Center, avoid doing business with them.  The added hassle of getting answers to any questions or concerns that arise significantly outweighs any of the advantages that are offered.

10)  Usage:  Determine what you will need the credit card for.  Do you have a real need for one?  Will it offer you advantages you don’t normally enjoy?  What will owning a credit card allow you to do that you can’t accomplish under current conditions?  How often will it be used and for what purpose?  Knowing what you intend to use the credit card for will help establish the need for one and eliminate confusion over when the card can be used.

These are the significant areas of consideration when it comes to choosing best credit card fitting to your needs.

Some will be more important than others, depending on personal perspective; however, diving right into the decision  without doing a fair amount of research can leave a bad taste in your mouth because, hidden problems weren’t discovered prior to making a decision, and they become readily apparent when the first bill comes due.

In this article you may feel I tried promoting credit cards.  If you are against using a credit card, I perfectly understand your point. People live happily without credit cards and without worrying much about spending limit, acceptability, etc. Cash is accepted everywhere!

What do you check before applying for a new credit card, readers? Leave your comments and make me feel special. Have a nice day!