Some people take one side or the other when it comes to using credit cards and what they can or cannot do for you. I’m going to save the debate on whether credit cards are good or bad for another day.
What I am going to discuss today is how to go about finding the best credit card for your needs, if you do want to get one. This may be a simple task for some, as they just sign up for whichever credit card company sends them a pre-approval letter in the mail. But to find the right card for you, it’s a lot more complex than that.
How to Choose the Right Card for Your Lifestyle
So, in order to choose the right credit card for you, you have to take a look at what kind of lifestyle you have. If you have a very lavish lifestyle, spend a lot of money, make a lot of money, and enjoy nice things, then maybe looking at a credit card with a higher credit limit would be enticing to you. Some credit cards that offer a higher credit limit often have higher interest rates as well, but if you’re a big baller shot caller, that shouldn’t matter as much.
Some credit cards come with a sense of prestige, such as an American Express credit card, which can be seen as having a higher status than, let’s say, a Discover card. Another thing about American Express is that it’s a charge card, which means you don’t necessarily have a preset spending limit, which could be enticing for some people.
But let’s say you have a very normal lifestyle, and all you really do is buy gas and groceries. In that case, we should look at a credit card that gives you the most cash back for those purchases. So, take a hard look at what you spend most of your money on and see how that can apply to which credit card you should get.
Compare Credit Card Rewards: Which Ones Are Right For You?
Some credit cards give great rewards for spending money using their card. These rewards can vary from airline points to cash back and even gift cards to various locations. If you want to start traveling more, maybe get a credit card that gives a lot of rewards for travel, such as hotel or airline points.
If you want to save overall, try to get a credit card that gives you a higher percentage of cash back on everyday purchases, whatever those purchases may be. This will give you the most bang for your buck overall. I even know some companies that give you cash back to put back on, let’s say, a loan or even a mortgage that you have with a certain bank or creditor.
Maximize Your Credit Card Benefits: What to Look for in a Card
When you’re looking for your new credit card, try to take a look at any kind of benefits or perks that come with the card. These benefits can be anything from access to airport lounges to cash back when you purchase food at a certain fast-food place.
They can even come with free subscription services like HBO Max or Disney+. Certain credit card companies give you benefits in other ways, like giving you a higher status at a hotel chain or making you a preferred user for a rental company. There are thousands of perks out there, so make sure you find a credit card that will allow you to maximize the benefits from the card.
Navigating Credit Card Fees: Finding the Best Deal For You
The unfortunate truth with a lot of these cards is that some of them come with fees, whether they are annual fees to be a card member or fees if you don’t pay off your limit at the end of each month. Some of those fees can be upwards of thousands of dollars a year. So, make sure that if you choose a card with an annual fee, you will get more money from the card than what you put into it. For example, if the annual fee is $300, you should be getting back $300+ in benefits from the card.
Something that a lot of credit card companies do is give you a certain sign-up bonus when you open the card. Make sure you do all you can to reach whatever limit they have on getting that sign-up bonus because that is free money on the table, and we all love free money.
How to Build Credit with Your Credit Card: Tips for Success
The last thing to discuss is ultimately what we all should strive for when getting a credit card: building credit. I have outlined in detail ways to build your credit, whether using a credit card or not, so definitely check out that blog as soon as you finish this one.
Tips for success in building your credit with a credit card consist of a few different things. Firstly, you never want to hit your credit limit each month when using a credit card, as this can lower your credit score. Secondly, there’s a number called the utilization ratio, which gives you the ideal percentage to use of your credit limit each month on your credit card. Finally, make sure that you either pay off your credit card each month or leave a small balance to transfer to the next month without incurring an interest fee. These are just a few tips. As I said earlier, please check out the blog for more information on how to build your credit. With that, peace.
