How to Choose the Best Credit Card to Meet Your Needs

Standard Credit CardsAlmost every bank or financial institution offers a standard credit card. These are unsecured offers, which mean they require nothing to secure the credit limit other than a good credit record to back you up. The interest paid on standard credit card accounts varies and depends on your credit history.

Introductory periods are a way to entice you to apply and use a particular card. These savings can be substantial, especially when making a large purchase. Be sure you read the terms and conditions of every card you apply for and understand how the interest rates and user fees will increase after the introductory period.

Transferring a high rate balance to a lower interest rate credit card is another way you can use a standard card to your advantage. Be careful that you understand the transfer fee that may apply and the time limit at the lower rate to be sure that it’s worth the effort making the transfer.

Reward Program CardsThere’s a reward program for just about everyone’s interest, hobby or business–from airlines to telephone companies. The typical reward program pays 1% cash back or equivalent value gift card or merchandise. Additional rewards are sometimes given for purchasing from the issuing or select merchants. For example: purchasing from Amazon.com with an Amazon credit card earns double the reward points. Airlines offer points to be redeemed for airline travel.

Due to the cost of running reward programs, an annual fee is sometimes required. Be sure to read the terms and conditions to reap all the benefits of being enrolled in the program. Reward credit cards are a great deal for those who pay off their balances each month as its like money in the bank.

Offers for Consumers with Bad CreditThe easiest credit card to qualify for to help rebuild or repair a damaged credit rating is the secured credit card. Collateral of some sort, whether a security deposit, jewelry, stocks or other items of value, is used as a security deposit against the credit amount that is authorized. Typically, the value of the item needs to be of equal or greater value than the amount being borrowed.

A low credit line of less that $250 is often available to those who need help rebuilding their credit. These carry additional charges and penalties but can help you overcome the credibility problem you may have with lenders and get your credit back on track.

One last consideration in handling a bad credit situation is the prepaid credit card. These work like a debit card in that the amount available is already secured by having it deposited upfront into a bank account. The risk of running up your debt is eliminated by using these cards. However, there are fees that may apply such as startup, over limit, ATM and more. Be sure to read the terms and conditions carefully.

Specialty Credit CardsBusiness cards are specialty credit cards offered to meet special credit needs of businesses. Like traditional cards they offer rewards, low intro rates, balance transfers, etc. There are additional benefits that may make these offers attractive: additional cards for employees, business rewards, separate expense reports for business and personal purchases and higher credit limits.

Student cards are offered to begin the process of building a healthy credit history. The credit limit is kept low to help the first time card user become accustomed to a monthly pay-off or payment.

Which Card is For You?Only you can decide the purpose of credit in your life. Be a smart consumer and comparison shop. Learn about all the terms and conditions and how they apply to the offers you are considering. Read the fine print.