Choosing the Correct Credit Card

When it comes to establishing credit, a credit card can be the easiest way to do that, but could also be the most costly. Be sure to keep the following things in mind before getting a credit card:

Is there an annual fee? Many credit cards have an annual fee, but the card usually comes with perks. You have to decide it the perks outweigh what you can get from a non-annual fee card.

What is the interest rate? Shop around to get the best interest rate. Many credit cards now give a 0% introductory interest rate. But, be sure to read the fine print to see how high the interest is after the time is up for the introductory rate. If the later interest rate is too high, you may be better off getting a standard card from the beginning.

What are the late fees? With the recent law changes concerning late fees, consumers need to be more aware than ever of late fees. Late fees have steadily increased over the last few years, making it crucial that you are diligent about making payments on time.

Is it a secured credit card? A secured credit card is for consumers who have poor credit or no credit. They are required to deposit a certain amount of cash against what they are charging. It is a good way to build up credit, but it is often difficult to come up with the cash needed for the deposit.

Is there a reward or cash back program? Many credit cards offer rewards for spending your money through them. There are points given per dollar you've spent that can be traded in for things like merchandise, travel, or gift cards. Cash back programs give you a percentage of your total purchase, but it's usually lower than the interest you are paying. Some have a "Frequent Flyer" program attached to their card. Some cards even offer more than one incentive program.

Does the company allow balance transfer? Many credit card companies will allow you to do a balance transfer from a higher interest card to a lower interest card, to gain your business. This can be a good move for consumers, as the lower interest will save them money over the long run. But, be sure to check for any fees that may be incurred.

By shopping around, you can find the best fit for your credit card needs, be it for personal or business use. Choosing the right card is only the first step, you must use it wisely to protect your financial future. If you've done the research and are still unsure what credit card is best for you, talk to a financial advisor.

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John Layton is the author of What Do You Really Want and can provide additional tips and advise at his websites www.creditcardhawk.info and www.creditcardhawks.info he also publishes a daily blog at www.internetsighting.info