Today, selecting the
proper credit card can be a bit confusing to say the least. There are literally hundreds of offers from
the major institutions eagerly competing for your
business. The easiest way to shop for a credit card
is to break them down into categories. There are
seven major categories that all credit cards fall
into. Each category is listed and explained below.
Once you identify the proper category, simply narrow
down the offers to the ones that best suite your
particular needs and lifestyle.
General Purpose/Low
Interest Credit Cards
These cards are great
general purpose credit cards for those not
interested in all the special features and costs
associated with CashBack or Rewards cards. They
feature either a low introductory interest rate,
and/or a low fixed rate.
General purpose
credit cards are usually favored by those who tend
to carry a monthly balance on their cards. A lower
interest rate can add up to substantial savings on
finance charges, and be of more value than cards
offering high rewards, or cash back. If you are
planning a large purchase, a low introductory APR
may be just what you need. You can stretch out your
payments over the length of the introductory period,
and save a bundle on finance charges.
Cash Back/Rebate
Credit Cards
Cash Back credit
cards give you cash or rebate incentives every time
you use the card. The amount given is usually a
percentage of your total purchases excluding
interest and finance charges. Cash back credit cards
should be considered by those who tend to pay off
their entire balance every month, and therefore
would not realize the benefits offered by low
interest rate cards. Cash back cards are always hard
to beat, but others may favor a rewards program
offering goods and services in place of cash. The
card you choose will depend upon your particular
needs and lifestyle.
Reward Credit Cards
Reward credit cards
give you points every time they are used to make
purchases. The points that you accumulate can later
be redeemed for goods and services. Cards offering
reward points are most attractive to those who tend
not to carry a monthly balance. If you pay off all
or most of your balance each month, a low interest
rate will be of little consequence, making reward
cards the perfect solution for reaping some extra
benefits out of your spending dollars. There are
many cards in this category that give special
rewards as incentives to shop at specific retailers.
Check the terms of each card to find the one that
will best suit your needs.
Airline Miles/Travel
Credit Cards
If you're an airline
traveler, you should look into credit cards that
offer Frequent Flier miles. You earn Mileage points
as you spend on your credit card. You also earn
mileage points for the miles you fly. If you took a
round trip to Orlando from Washington DC you would
earn 1516 mile points. If you bought the ticket on
your card you would earn even more! Most Frequent
Flier credit cards will give you 5,000-10,000 free
miles as a sign-up bonus, as well as discounts on
car rentals, free hotel upgrades, and many other
perks. Be aware that there may be caps on the amount
of miles you can earn in a year, as well as
expiration dates for unused miles.
 Business Credit
Cards
If you own a small
business then you should consider a business credit
card. With a business credit card, you can make
purchases under your business name, allowing you to
separate your business and personal expenses.
Business cards can in some cases carry a higher
limit than a personal card, and additional cards may
be issued to executives, or employees. Most
institutions offer business cardholders a special
categorized statement that makes it easier to manage
your company's finances and spending habits. Student Credit Cards
Student credit cards
are available to actively enrolled College students.
They are ideal for building a credit history, and
teaching the principles of financial management.
After graduation, the credit history established
with a student credit card can be a great help when
buying that first new car, or even applying for a
mortgage. It pays to start early and establish
yourself as a responsible person by paying your
bills on time. A student credit card usually carries
some restrictions not found on ordinary credit
cards. A co-signer is sometimes required on the
account, and in such cases, permission from the
co-signer must be obtained before the credit line
can be increased.
Bad/No Credit Credit
Cards
If you have bad
credit, or simply no credit history at all, there
are alternatives to help you build/rebuild your
credit. Many institutions offer secured, or pre-paid
credit cards to individuals seeking to build or
rebuild their credit. A secured credit card requires
that you supply the institution with some type of
collateral such as a car, home, boat, or cash. They
will issue you a credit card secured by the value of
this collateral. It functions just like a regular
credit card, except that if you default the bank can
seize the collateral.
Credit Cards For Those With Bad Credit
 We have over 50 Banks & Companies that offer Bad Credit Unsecured Credit Cards and Merchant Cards to people with good credit, no credit, bad credit, or even a bankruptcy. - NO SECURITY DEPOSIT. Click here for more info |
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Another solution is a
Pre-Paid credit card or "Debit" card. Pre-Paid cards
require that you deposit funds into the card's
account in advance of making any purchases. When a
purchase is made, the funds are deducted from the
account balance. This is not really considered a
credit card since no credit is actually being
granted by the institution. Debit cards are a great
alternative to carrying cash, and are hence much
safer.
© Written By: Michael
Casamento
Michael Casamento is
the founder of the Credit Card Safari web site,
offering quick and easy comparisons of the latest
credit card offers from top financial institutions.
For more information
visit: http://www.creditcardsafari.com
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