There is no rule of a thumb for each and every credit card user to go by. Picking the best card depends on how you handle the money. So, you need to be guided by your particular situation. Here are some tips that may come useful to you.
If you have a good credit score, then your goal is to find a credit card with low interest rate and with the excellent reward offer. Some such cards can help you to save money or even gain money or bonuses.
Look for cash rewards
You may get a cash back card. If you pay down all your loans monthly, this may prove to be a nice alternative for you. Some cards, such as American express blue cash card, are great when paying for daily needs. If you use this card to pay for your food and fuel and if you spend over $6 000 per year, you get 6% money back. You may also get certain sign up bonuses, which in most cases would match or even exceed your annual fees paid on such a card.
Look for specific benefits
If you love traveling and go abroad time after time, you may want to look for a special credit card. There are many good offers in this market segment. One of the things to look for is free transactions made in other countries. If you use regular credit cards for that purpose, you get charged up to 3% for each transaction. So, such travel card can save you some money. Plus, lots of such cards have various bonuses and rewards to offer.
If you have a bad credit, then you may be interested in different benefits offered by credit cards.
Look for low interest rates
If you cannot afford to pay down your monthly loans, then your priority is to find the lowest monthly interest rate possible. This would end up saving you tons of money. Of course, the lowest rates are always offered to people with the speckles credit history. Still there are some options you may choose from. If you are using several credit cards, pick the one with the lowest interest rate and go for it.
Look for balance transfer opportunities
If you have improved your credit score of recent, but you still are paying high interest rates on your loans, look for balance transfer opportunities. Again, find the card with the lowest interest rate offered. Then transfer the balance from other credit cards to this one. This may help you to reduce your monthly payments and to get out of debt quicker. Keep in mind that some credit card companies offer you zero percent on your balance transfer for a certain period of time. Find the credit card with the longest “free” period and go for it.
Look for secured credit cards
If you have bad credit history, you may want to get a secured credit card. Here is what it means. You make a security deposit on that card and it stays there through the entire period of usage. You cannot use that money for covering your monthly payments. The deposit gets refunded to you, when you end up using the card. If you improve your credit score, you can easily switch from the secured credit card to a regular one.
Hopefully, these tips would help you to make the choice of the best credit card for the upcoming 2013 year.
Sean Harris is a finance and technology blooer and more of his work can be seen at irs-website.org