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Choosing the right credit card

By Ben Woolsey

Today, everyone has a credit card. From teenagers to corporate professionals to retirees, everyone is enjoying the ease and benefit of carrying credit cards. However, before applying for a credit card, there are several factors to consider when deciding what credit card is best for you.

Credit cards – many shapes and sizes
There is a perfect credit card program out there for you. Which one is right for you will depend on several factors, such as:

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  • Age
  • Credit ranking (rating)
  • Spending needs (how much money you need)
  • Payment structures (how you will pay it back)
  • Special interests
  • Number of current credit cards
  • Income (how much money you make)

Credit cards are also issued through numerous financial groups and organizations. For example, it’s not only banks such as Bank America or Citi that offer credit cards to their members. Specialty financial organizations such as American Express Financial Group—who offers the American Express card—and Novus—who offers the Discover Card—do as well. The only difference is some organizations may be more competitive about interest rates and qualifications than others.


Which Card is Right for Me?
Before applying for a credit card ask yourself these questions:

  • Why do you want/need a credit card? – Maybe you need one credit card with a special interest rate to transfer balances from multiple accounts or perhaps you need a card specifically for business purposes.  Being able to earn rewards, cash back or airline miles for your everyday purchases can also be a reason to get a credit card.
  • How much do you need to charge at one time? – If the credit card is for business purposes, maybe you need a card with very high or no spending limits. On the other hand, if this is your first card and you are trying to build credit or just want the card for emergencies, then a more modest spending limit may be the better route to go.
  • How do I want to pay back the charges? – Decide if you want to pay off the entire balance each month or just a portion over each month. Some cards offer advantages for both paying structures.
  • Do special offers interest me? – Many credit cards offer special rebates, support for a specific organization or other member benefits for using their credit cards. Decide if this is important to you when choosing your card.

Managing my credit
Now that you know what type of credit card you want, it is time to manage your credit. A credit card is a responsibility, not a right. Understanding why you want a credit card, knowing how the credit card process works and picking a credit card that works best for you will help you avoid debt management pitfalls. Use your credit card to extend your buying power while keeping in mind that a credit card is not free money. To maintain a good credit rating, you will need to pay your credit card statements in a timely manner, according to your agreed-upon terms of use. Be responsible with your credit and enjoy the benefits credit card possession can bring. If you have questions or concerns about what is the right card for your specific credit or financial need, talk to a professional financial adviser. Take the extra step and be sure you understand everything you need to know before applying for a credit card.

Published: August 10, 2005


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Updated: 09-29-2016


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