Credit cards are not one size fits all. So how do you choose what’s right for you? Whether you’re focused on building your credit, paying down debt, or planning for that dream vacation, there’s a card out there that fits your lifestyle.
Need to Stick to a Budget?
If you want to build your credit history while smartly managing your money, pick a secured credit card that helps you control your spending habits right off the bat. A secured card requires a deposit into a savings account—the collateral—that secures the credit line on your account. Secured credit cards help you build credit by reporting your purchase and payment activity to major credit bureaus. By only spending against the collateral you’ve secured, you’re learning how to responsibly manage your credit, while avoiding large amounts of debt.
Tip: This type of card is great for college students, people looking to establish credit, and those who need to watch what they purchase.
Want to Pay Down Your Debt?
If you typically carry a high balance and are working to lower your debt, look for a card with a low interest rate. Credit card companies will often offer a low introductory rate—sometimes even 0.00% Annual Percentage Rate (APR), or the amount of interest you’ll pay annually. If you’re looking for a better money-saving option from higher APR credit cards, and if you have established credit, you’ll likely be eligible for this type of card. Low rate cards help you minimize interest, which allows you to consistently tackle your debt.
Tip: Introductory APR rates will end after a certain amount of time. Be sure to plan around this accordingly.
Looking to Earn Extra Perks?
If you have an excellent credit score and you know how to manage your money well by paying off your balance in full each month, consider benefiting from the added perks of a points-driven or rewards card. With a points-driven card, everyday transactions and purchases turn into points that may be redeemed for merchandise, travel, or cash (which make your purchases go further). If you have an excellent credit score and you know how to manage your money well by paying off your balance in full each month, why not benefit from the added perks of a rewards card?
Tip: If you do decide to pick a points-driven card, be sure to keep an eye out for an annual fee. Some cards require it, but others don’t.
Ready to Find the Right Card?
No matter where your priorities lie, there certainly is a card that best fits your goals. Choosing a card based on your personal situation and preference ensures that you’ll make the right decision. Whether you’d like to build credit, save money, or earn rewards, do your research. With these preferences in mind, tailoring your card to your specific needs is no longer a tall task. For more information, use our comparison chart to find a card that’s right for you.
