Foreword Credit cards are meant as a convenience. They are an easy way of taking care of your everyday finances while freeing up more financial resources for something else — like investing in property. But there is also the potential downside where credit card companies can take advantage of consumers, leading them into bankruptcy or falling behind on their bills. To avoid that fate, consumers must become wise about how much they should spend every month and everything else regarding debt management. To help consumers with this task, we've prepared a guide that goes over what you should be looking for when choosing a credit card Interest Rates and Fees This is one of the most important pieces of information. If you pay off your purchases in full each month, the interest rate and fees will stay the same. Look for a card with a low APR. Check out this site to easily compare credit cards and find your ideal option.
Rewards Rates and Sign-Up Bonuses
Rewards rates and sign-up bonuses can be very lucrative. The more you save, the better. Check the fine print if you're looking at any offering points or miles. Some have constraints on how they can be redeemed.
Length of Time You'll Have to Pay off Your Purchases
Different cards offer different grace periods depending on an installment purchase or a balance transfer. Ensure you can pay off the purchase before the grace period expires.
Cash Back Percentage on Purchases
This is especially handy if you're trying to rack up rewards. Some have tiered levels. The more you spend, the more cash back you can get, so be sure to check what you are offered.
Annual Fee
Cards with an annual fee are great if you plan on using them often, but they can be a huge money waste if you don't. Carefully read the terms and conditions before applying to see how much interest they will charge. Not only will this cost extra money, but it may mean that you pay more interest on your balance than if you had applied for a lower-interest one.
Rewards Programs
Many offer rewards programs in addition to cash back, which is a great way for consumers to save money when shopping and earn points that can be redeemed for cash or other rewards that can be stored in their account once they accumulate enough points. Final Thoughts Regardless of your chosen credit card, it's vital to remember that responsible credit card use is all about striking a balance. You want to pay off your purchases in full and avoid interest charges as much as possible, but you also want to be sure you're taking advantage of the best rewards. The best way to make that happen is to carefully review your options before you sign on the dotted line.
