How to Compare Credit Cards
Credit cards have various benefits and perks as well as terms and conditions. Try to find the one that best suits your circumstances.
1. Fees
Many credit card companies do not charge annual fees but generally their APRs are higher. Those who do charge fees can charge as much as 3.2% but their APR is lower. Decide which option will suit your needs.
2. Interest Rate / APR
The APR charged can be anything from 15.9% to 19.9%. The good news is that if you pay your statement in full and on time every month, you can get up to 52 days interest free on new purchases. Your personal circumstances and your credit history will determine what APR the company will quote to you. It may be that you are offered a different rate than the one quoted.
Consider the rate charged when you would want to transfer a balance. A cash withdrawal rate or fee may be levied when you withdraw cash at an ATM.
3. Introductory Offer
The interest-free introductory period on purchases can be anything from 3 months to 18 months. After this, the card charges a typical representative annual percentage rate (APR) of, say15.9% variable. This tells you that you should pay off your debt within the interest-free period; otherwise you will pay interest.
4. Points/Rewards/Cash Back
All cards offer some form of pay back to their cardholders. It can take the form of rewards, cash back, discounts and the like. The card issuers normally enter into an agreement with specific retailers for this purpose. Clients can earn rewards at a variety of outlets from restaurants to shopping, travel and fuel. As much as 1% can be earned in rewards money, which is useful in these times. These rewards can be redeemed at selected dealers or, alternatively, can be saved for a large purchase in the future.
5. Provider
There are many credit card issuers to choose from. The interest rate and benefits offered by a specific provider may appeal to you, but do they have a good track record? What is their customer service like? Can you easily access a consultant at a branch or are online services available? Fees and charges should be as fair as possible. Which credit card does your parents, family and friends use? If they are happy, you can take your cue from them.
Other points to consider are:
You should be older than 18 years and have a clear credit record to be considered for a credit card. There will also be a minimum income requirement, i.e. you might not earn enough to qualify for a credit card.
If you are someone who wants to manage your card online, make sure that you apply for an online credit card.
Many sites are available where you can go to do a credit card comparison. It will be to your advantage to do the homework first and apply for the card second. That way you can make sure you get the best card for your needs
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