Choosing Your First Credit Card
There are so many credit cards out there that it becomes quiet difficult for first time users to decide how to choose a credit card. But it is essential that whichever card you select should match your living style and spending power. In order to get the best deal for your credit card from the best company you have to do some initial research to find out what suits you most.
You have to decide, for example, the need of a credit card in the first place. The ideal use of the credit card is for purchasing products with some source of income at your bank account. And at the month’s end pay the bill. This is a good example of how to use your credit card for instant cash items.
You should prepare a plan for paying your bill payments in the next step. You can choose to pay the full balance or only the minimum required amount each month. Some people use credit card to access instant cash by using it at an ATM. If your sole purpose is for getting instant cash and balance transfer then you should look out for a credit card that offers the lowest cash transaction rate. This is of good use when you travel or go for a vacation.
Compare Credit Cards
Next important thing to look for in your credit card is the incentives. Companies offer great deals especially for new credit card holders. You should check out their offers for introductory rates and balance transfer rates. Companies also offer incentives for using your credit card. These include reward points and cash back on purchases. You can use cash back to pay your credit card bill. You should be ready to compare such incentives offered by different companies.
After this you need to compare the APR (Annual Percentage Rate). APR is the rate that you will pay for your purchase once the incentive period is over. You should look out for the credit card that is offering the lowest APR as it can vary among the cards. Compare them and find the lowest APR.
Next thing to look out is the interest free period offerd by the credit card. Well select the card with longest time-frame period for which you are not bound to pay any interest on your purchases. Another big concern is the minimum payment amount. And like APR it can vary greatly for different cards. Generally the minimum payment balance would be around 3% or so, but it can be on the downside as well as very high for different companies offering the service. you must choose wisely for the lowest payment amount.
As a final thought you should put some time and research to find the best credit card for yourself. Once you decide and opt for a credit card make sure that you inquire about all the offers and rates provided with it. Credit cards are fine to have but use them wisely otherwise you will be left pulling your hairs. A good advice to follow for credit cards is to always pay your bills on time, which would help in increase your credit and consequently your purchasing power will increase. Go out and put some time to compare the credit cards on various parameters stated above.
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