What credit card should I get?
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Having a credit card can provide you with a lot of freedom. You have to manage a credit card responsibly, though, or it can be a huge problem. Before you get a credit card, there are a lot of questions you should ask to make sure that you are getting the right card for you. Here are some of those questions that you need to ask:
- Is there an introductory rate? If there is you need to know what it is and how long it is going to last. You can save yourself a lot of money by finding the best possible rate.
- What will my rate be when the introductory rate ends? It is nice to save with a low introductory rate, but that won't help if you end up paying a really high rate later.
- Is there:
- An application fee? - It may not make sense to apply for a lot of cards if it is going to cost you a lot to do it.
- A processing fee? - All the fees can add up if you aren't careful, so you need to be aware of what you are getting yourself into
- An annual fee? - An annual or monthly fee isn't necessarily a bad thing, but you need to know what you are getting for it and if it is worth the money
- A late fee? - Inevitably you will miss a payment because of a mistake or other circumstances. What will this cost you?
- An over-the-limit fee or other fees that may come up along the way? - Be sure to read the small print of the application to see what fees are involved
- When and by how much can the interest rate be changed? - Some cards have no limits on the changes in interest rates that they can make. That means you can think you are getting one rate, but may end up getting another, much higher rate once you have the card. Be sure you know what the rules are so that you don't get a nasty surprise.
- Is there a grace period before interest is charged? - Some cards don't charge interest for the first month after a purchase, while others charge from the second the purchase is made. If you use your card a lot, this can make a big difference to you.
- Will I be notified if I go over my limit? - This is especially important if there is a fee or penalty for going over or remaining over the limit. Sometimes you can go over without even knowing. You want a card that will notify you and you want to know what happens if you go over.
- What if I can't pay my bill? - Sometimes things happen and you can't make a payment. You need to know what will happen so that your credit history isn't damaged too badly.
- Can I pay my bill online? - Online payments make it convenient and easier to pay and manage your account.
Posted by jonathan on December 26, 2005 at 11:30 AM