The questions you need to ask before choosing a credit card

Image courtesy:RE/MAX of Cherry Creek

Are you thinking about buying a new credit card? Credit cards are incredible as they allow you to buy absolutely anything without any cash and then later allow you to pay for them on a monthly basis. There are many types of credit cards, and just as many different terms and conditions that credit card companies offer. So, before choosing a credit card that is right for you, you should ask these seven questions to make sure you are getting exactly what you wanted.

  1. Would you carry forward your balance?

The first question you need to ask is to yourself. And the question is if you would like to carry forward your credit card balance for more than a month of not.

Image courtesy:SlideShare
Image courtesy:SlideShare

There are two kinds of credit card holders in case of balance holdings:

  • Those who do not carry forward any balance. These people hold a credit card, make their purchases and but then pay the credit card bill in full, each month. This allows them to never be charged with extra interest rate that might add to their debt.
  • While on the other hand, the other kind of people carry forward their credit card balances, and get viable to pay for the interest that extends with every extending month of balance. This can work as well, if the credit card they choose offers low interest and high cash-back and rewards.

So, choose which kind of a credit card holder you would be, so that you can avoid paying high interest rates and actually lose your hard earned money.

  1. Are you currently under credit card debt?

The second question you need to ask before choosing a credit card is that if you currently are under any other credit card debt. Because if you are in a credit card debt, then the next card that you get should be a promotional financing 0% APR credit card, which does not charge you with interest.

By getting a credit card with 0% APR will result in your current debt being transferred to this new card, and not grow due to interest rate. Using a credit card like this, you can settle your old debt, and not let it expand, while getting a new card, which will not impact your savings. 

  1. Do you travel often?

    Image courtesy:Pixabay
    Image courtesy:Pixabay

If you often travel and use flights and hotels during your frequent travels, then instead of opting for a company credit card, you can get an airline or hotel credit card. These cards allow you to have many perks; including free breakfasts, discounts on purchases in the flight, free lounge service, free checked bags, and even an elite status in the loyalty program. All of these things can add to your wealth and help you save more on your travels.

  1. Do you wish to save for vacations?

The next question you need to ask is if you are thinking about saving money for a big vacation. The vacation will make you spend a lot more than you are accustomed to in your daily life. And so, to embark on such an endeavor you will require a travel rewards credit cards.

A travel rewards credit card works in such a way that it either gets you a statement credit for all your travels or it transfers points to many airline and hotel loyalty programs, so that you can enjoy many perks. These cards are perfect for the people looking for saving money on their already expensive travels. And the best travel rewards credit card will get the most points and help you get the best perks.

  1. How is your purchase rate per month?

You need to ask yourself and make a list of your average purchases that you make every single month. And if you are a big shopper then you need a card that can offer your redeeming points on every shopping you do. These rewarding points and cash backs can come on groceries, dining, gadgets, gas, etc.  And choosing a credit card for this purpose can help you save a lot.

  1. Are you an owner of a business?

    Image courtesy:Flickr
    Image courtesy:Flickr

If you are a business owner and make many purchases every month on your credit card then you need a card that is specifically designed for that purpose only. These cards are called business credit cards. And choosing a credit card for business will help you track your purchases better, give you reports of everything and will also reward you on different types of purchases.

  1. Are you suffering from bad credit?

The final question that you need to ask yourself is if you have a bad credit. If you do have a bad credit then you can qualify for a secured card. Choosing a credit card that is secure is the only option for you, if you have to attain a credit card. The only difference between a standard card and the real card is that you first will be required to make a deposit to get the card.

So, we hope all of these questions help you in choosing a credit card that is best for you.