How to Choose the Best Credit Card in 2017

How to Choose the Best Credit Card in 2017: A Comprehensive Guide

Credit cards have become a ubiquitous aspect of modern life. They can help you make purchases, build credit, and earn rewards. However, with so many options available, choosing the right credit card can be a daunting task. In this guide, we will take a closer look at the factors you should consider when selecting a credit card.

1. Determine Your Spending Habits

Before applying for a credit card, take some time to evaluate your spending habits. Look at your monthly expenses and determine where you spend the most money. This will help you choose a credit card that offersrewards and benefitstailored to your specific needs.

For example, if you frequently travel, consider a credit card that offers travel rewards or airline miles. If you spend a lot on groceries, a card that offers cash back on grocery purchases may be a good fit.

2. Consider the Interest Rate

Theinterest rate, or Annual Percentage Rate (APR), is the amount of interest you will be charged on any balance you carry from month to month. It is important to choose a credit card with a low interest rate if you plan to carry a balance.

However, if you plan to pay off your balance in full each month, the interest rate may be less of a concern. In this case, you may want to focus on other factors, such as rewards and benefits.

3. Look for Rewards and Benefits

Many credit cards offer rewards and benefits such as cash back, travel rewards, and points that can be redeemed for merchandise or gift cards. When choosing a credit card, consider the types of rewards and benefits that are most valuable to you.

Additionally, some credit cards offer perks such as extended warranties, purchase protection, and travel insurance. These benefits can add extra value to your credit card.

4. Check for Fees

Credit cards can come with a variety of fees, such as annual fees, balance transfer fees, and foreign transaction fees. It is important to read the fine print and understand all of the fees associated with a credit card before applying.

If a credit card has an annual fee, make sure the rewards and benefits outweigh the cost of the fee. If you plan to travel abroad, look for a credit card that does not charge foreign transaction fees.

5. Consider Your Credit Score

Yourcredit scoreis a key factor in determining whether you will be approved for a credit card and what interest rate you will be offered. Before applying for a credit card, check your credit score and make sure it is in good shape.

If your credit score is low, you may want to consider a secured credit card, which requires a deposit and can help you build credit over time.

Tips for Applying for a Credit Card

When applying for a credit card, there are a few tips to keep in mind:

- Apply for a credit card that matches your credit score. If you have a low credit score, do not apply for a card that requires excellent credit.

- Apply for one or two credit cards at a time. Applying for too many credit cards at once can hurt your credit score.

- Read the terms and conditions carefully before applying.

- Pay your balance in full each month to avoid interest charges and late fees.

Saving Money with Credit Cards

Credit cards can also help you save money in a variety of ways. Here are a few tips:

- Look for credit cards that offer cash back or discounts on purchases you make frequently.

- Take advantage of introductory offers such as 0% APR for a limited time.

- Use a credit card that offers price protection to get a refund if you find a lower price on an item you purchase.

- Take advantage of credit card rewards to save money on travel or other expenses.

Avoiding Credit Card Fees and Risks

While credit cards can be a valuable tool, they also come with risks and fees. Here are a few tips to avoid common credit card pitfalls:

- Pay your balance in full each month to avoid interest charges.

- Avoid making late payments or missing payments, which can hurt your credit score and result in late fees.

- Be aware of the risks of identity theft and take steps to protect your personal information.

- Keep track of your credit card spending to avoid overspending and accruing debt.

Recommended Credit Card Companies

There are many credit card companies to choose from, each with its own unique benefits and drawbacks. Here are a few recommended companies:

- Chase: Offers a variety of credit cards with rewards and benefits tailored to different spending habits.

- American Express: Offers premium credit cards with exclusive benefits such as airport lounge access and concierge services.

- Discover: Offers cash back rewards on all purchases and has no annual fee.

- Capital One: Offers credit cards with flexible rewards and no foreign transaction fees.

In conclusion, choosing the right credit card requires careful consideration of your spending habits, credit score, and needs. By following these tips and choosing a credit card with rewards and benefits that match your lifestyle, you can make the most of your credit card and avoid common pitfalls and fees.