Credit cards are a normal part of life today. People from all walks of life use them to do almost all of their financial business, from paying their monthly bills to buying things at grocery stores and convenience stores. Credit cards are now just as good as cash everywhere, with the possible exception of the most remote parts of the world. In some cases, they are even better than cash, because they can be used in foreign countries without having to change a lot of money into the local currency.
But there are so many different credit card companies out there, and each has its own set of packages with different rates and benefits. How do you choose one that fits your needs? Here are a few simple things to keep in mind when looking for the best credit card for your lifestyle.
Check to see what kind of card you need. Even though it may seem like all credit cards are the same, there are actually many different kinds. This is similar to how there are many different kinds of bank accounts, each with its own features. Here are some of the most common types to choose from:
Student Credit Cards: As the name suggests, these credit cards are made for college students. Since most students don't have a lot of money of their own, the credit limits on these cards are set to keep students' spending at a reasonable level. Also, the interest rates are lower because, again, it is thought that the people who use these cards won't be as good with money. Most of the time, they will only work part-time, so the rates these cards offer are usually fair. The credit limit is the biggest problem with a student credit card. However, this isn't such a big problem when you consider that the lower limit also helps people keep their good credit standing and doesn't let them overspend. If you want to get a credit card as a student, look for one with reasonable interest rates and a credit limit that will help you stay within your budget.
Business credit cards are designed for people who run their own businesses. The main reason for these cards is so that a business owner doesn't have to use his or her own credit card to pay for the costs of running a business. Due to the expected costs of running a business, business credit cards usually have higher credit limits than regular credit cards. Most of the time, the rates for these cards and the credit limits that go with them depend on the financial health of the business that the card is for. When looking at these cards, keep in mind how much money your business is expected to make. Get a business credit card that can cover your overhead costs, and make sure the interest rates are low enough that your expected income can cover them.
Credit cards with 0% interest at first are called "zero-interest credit cards." The name doesn't mean that there is no interest on the card forever. Instead, these cards have an introductory period, usually between 6 months and a year, when there is no interest. After the period is over, however, the regular rates kick in, so it's a good idea to check out the interest rates and credit limit after the introductory period is over.
Low-Interest Credit Cards: These credit cards usually have a lower interest rate than others. Unlike zero-interest cards, which offer no interest for a certain amount of time and then switch to regular rates, low-interest credit cards always have a lower interest rate on all debts. When choosing one of these cards, you should think about other things. For example, the card may have an annual fee or a lower credit limit. Check these out before applying for a low-interest credit card.
Reward System Cards are credit cards that give you extra perks when you use them. There are many different kinds, like credit cards that give you airline miles, hotel credit, gas points, or even cash back. When looking at one of these credit cards, the interest rates should be taken into account. However, the most important thing is to see if the rewards make up for the interest rates. As long as the rewards fit with the way you live, these cards are a good choice.
These are just a few easy tips about the different kinds of credit cards you can get. To find the best credit card rate, you don't just have to look for low-interest cards. Instead, find one that fits your lifestyle and needs, and the rest will fall into place.
