Life without a credit card is almost beyond belief today. Not only does it provide ease of repayment and use, but is a remarkable medium to build our credit profile, which is one of the important parameters that determine our edibility and the pricing for lending products like home loans, personal loans etc. while the general specs provided by credit cards are similar, to make full use of a credit card, you should opt for one that meets your lifestyle and spending habits. This will permit you to utilize amazing cashbacks discounts and reward points that would support you decrease your transaction costs.
Here are the factors that you need to consider while picking your credit card
Spending habits
Most credit cards are aimed at certain kind of customer segments by providing reward point and other advantages on specific type of transactions. For example, while fuel cards come with higher cashback on fuel transactions, others provide higher advantages on grocery and other regular spends. Credit cards with travelling advantages provide frequent visitor free air miles, lounge access at airport, hotel stays, etc. Similarly, some cards also provide up to five percent cash back on utility spends.
Finance charges
This charge is levied right from the transaction date until the repayment of the full bill amount. Finance charges can change widely from 22 to 47 percent p.a. depending on your card type. Although, it is powerfully advisable to reject using credit card to withdraw cash, because of its top interest rate, matching the finance charges is still vital as there forever remains a possibility of incurring this charge due to financial emergencies and unavoidable circumstances.
Fees
Credit card issuers earn money through their fees charges on different credit card services. Some of the most vital charges contain yearly fee, joining fee, late payment fee, rewards redemption and cash advance fee.
Joining fee is a 1 time charge while renewal/annual fee is charged every year. Joining and yearly fee depend on the card type, generally ranging from $2 -$50. Some credit card issuers waive off joining fee or yearly fee or both on applying via online credit card marketplaces. Similarly many card issuers reverse their yearly fee or joining fee when cardholders spend beyond a threshold amount within twelve months. Anyway, forever prefer a card whose advantages in the type of cashback, welcome vouchers, reward points or discounts outweigh the yearly fee and joining fee.
