How to Smartly Choose a Credit Card
We are living in a world that is greatly dominated by credit, and this is what makes us thrive. From student loans, mortgages to credit cards, the world uses credit. It can be overwhelming choosing the right credit card nowadays because of the many options available right now from basic type to Triple-Platinum Ultra-Points Perks Plus cards. Whatever is your financial situation, there are so many choices of credit cards available and being offered in the credit card industry.
When choosing a new credit card, you have to take into consideration your existing debt load such as student loans, car payments, and other credit cards you have. Your mortgage or property amortizations are not the same types of debt so exclude it to your computation. If your existing debt load is more than ten to fifteen percent of your take-home pay, you have to reconsider obtaining a credit card until you have paid off or paid down some of your existing debt. While it is true that credit is very helpful, it can spiral out of control that fast so it is crucial to learn the art of financial discipline by knowing your expenses and prioritizing your needs and wants. There are different types of credit cards for different purposes, that’s why you need to identify the reasons why you need a new one. Do you want to rebuild your credit? Then you can find one with a low-balance card to help you achieve this goal and obtain a higher credit score. Do you want to travel a lot? The perfect type of credit card for a traveler is one that offers travel points for airline miles. Do you need a credit card for emergency purposes? It is best to choose a credit card with a low annual fee to save money on fees for a card that you’ll rarely use. Are you always shopping around? You’ll need one that offers a great percentage off your purchases.
It is important to take into account your spending habits. If you’re always shopping in bulk, you may want to get a new credit card with a lower interest rate and a higher credit limit. The interest rate is an important consideration because you don’t want to pay that much just to borrow money. In general, an individual with a good credit standing gets a lower interest rate. If you use credit card frequently, an annual fee is not a huge issue, but if you rarely use it, then you need to compare the annual fee against your spending balance. You can use a credit card validator to allow you spelling out exactly what is happening with your credit card.