Choosing The Right Credit Card

Choosing The Right Credit Card

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It is a given that most consumers carry at least one credit card, perhaps several when you include department stores, gas station cards, plus MasterCard, VISA, AmericanExpress, Discover and others. Consumer lending is a huge industry, one that lenders depend on to fuel their businesses.

Credit CardsNot all credit card offers are equal with some offering high rates and no rewards to others which will give you a low, fixed rate and shower you with special prizes. Before you choose your next card, let’s take a look at the variety of credit card options out there for your consideration.

Low Interest Rate Credit Cards — Despite the recent run up in interest rates, there are still credit cards available with low rates, even zero percent financing for balance transfers. Usually, these special rates are in place until the transfers are paid off with newer purchases charged at a higher rate.

Low Introductory Rate Credit Cards — To get you to use a new card, some credit card providers will offer you a special “teaser rate” that will run for several months, usually for as long as six months. You can make purchases at the very low rate (let’s say 1.9% for six months) and then pay 12.9% or more after that time. This can be a great way for consumers to make an expensive purchase they plan on paying off within a few months time.

Pre-paid Credit Cards — For consumers with bad credit and for students who are off to college, a pre-paid credit card allows holders to build up their credit while still having the convenience of shopping with plastic. No worrying about carrying around a wad of cash — if you lose the credit card you haven’t lost your money.

Rebate Credit Cards — Use your credit card and get paid for it! Sounds like a come on, but it is true: some credit card providers will give you cash rebates on select purchases. Spend $1000 and you could have $10 or $20 credited to your account, depending on the offer.

Award Credit Cards — Also known as rewards cards, an award card works similarly to a rebate credit card: you get to select gifts based on points you have accumulated with your purchases. Typically, one point is awarded for every dollar spent and you can redeem those points online or through a catalog sent by the credit card company. Many award credit cards will automatically give you 500 or more points with your initial purchase and some will incentivize their offers through special promotions which can double or even triple your points during a special promotional period (for example, the Christmas shopping season).

The previously mentioned credit cards choices are typically MasterCard or VISA network credit cards, but American Express and Discover have special offers which might be of interest to you too. You can manage your various rebate cards with this free download to help you get the rebates and rewards coming to you.

Photo Credit: Miguel Ugade, Mexico.

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