As much as financial analysts tout the benefits of using cash. In this modern day and age it is just not possible to always use cash. Besides which if you ever have the intention of buying your own home, you will need good credit, and good credit only comes through the use of credit cards.
So, now that we have established the importance of credit cards lets review the points that should be taken into consideration when you apply for credit card.
You need to know what you need in a credit card, and more importantly what you can afford. You want to get a credit card that you can pay off safely every month, so it would probably not be a good idea to get a high limit credit card. The higher the limit you have, the higher the temptation you have.
Now that you sort of have an idea of what you are looking for, then you are ready to go out looking for credit card companies. Make sure you choose a reliable credit company to apply to.
When you are applying for a credit card, whether it is by mail or by internet, pay attention to what the application is telling you.
Make sure you know what the APR rate is, and what the one time annual fee is, and what the renewal fees are. Most credit card companies try to hide this information as hard as possible. That is why they only list it in the fine print section of their application.
Go over the credit card companies’ policy regarding interest rate. Some cards even come with a 0% interest rate. Find out if the card has a fixed or a variable interest rate. A fixed rate is the one you want because it never changes, at least not throughout the year. Variable interest rates on the other hand change to some degree.
Review your annual finance charges. Most credit cards charge some kind of annual fee which can range any where from $25 to up to $75. You may have other costs too, depending on what you do. For instance some credit cards will charge a fee for using cash withdrawal options, and others will charge you a fee for transferring balances.
Before you apply for that credit card find out what the grace period of the credit card is. Find out if they give you a few days after your pay day limit is up.