Selecting a Credit Card

Picking a Card

Selecting a credit card is really a matter of priorities.  For those with excellent credit, the number of options available to you is almost limitless.  There are gold cards, silver cards, plum cards, and black cards.  There are cards that pay you back, cards that help you take free trips, and cards that get you into private lounges.  Then, there are cards with no annual fee or low interest rates.  For those with less favorable credit scores, there are fewer options and the options that are available are generally less favorable.  But, in any event, the following should assist a person of any credit score level to choose a credit care.

How much is the card going to cost you?

If you intend to carry a balance, then the most important issue is the annual percentage rate or APR.  The higher the APR, the more that you will pay in interest based on the balance carried on the card.

If you do not intend to carry a balance on the card, then there are three important considerations.  First, is there an annual fee?  For a person with reasonably good credit, the option of cards with no annual fee should exist.  For those with poor credit, an annual fee may be required.  The APR is not an important consideration if the balance is paid off within the grace period offered by the card issuer.

The second consideration is the grace period.  The grace period is the time between the purchase and when the interest begins to accrue on your purchases.  These terms should be disclosed on any credit card solicitation.  Knowing the grace period can mean the difference between paying interest on your purchases for the month or not.


What kinds of benefits are available?  Whether carrying a balance and looking for a low interest rate or not carrying a balance and looking for low fees and a long grace period, the additional benefits provided by the card issuer are important in evaluating the right card for you.

And there are a ton of choices out there.  There are cards that offer any number of side benefits.  These can include airline miles, hotel points, cash back, prestige, access, donations to schools or causes.  As the credit score decreases, the options for these kinds of benefits also decreases, but once the cost of the card is set, these benefits are the primary factor in making the choice among the many cards offered.

If you have clearly understood the terms of the credit offer made to you, evaluated the costs, and searched for the best benefits, you have probably found the right case for you.