Consumers are increasingly being subjected to credit card offers that make the urge of owning a credit
card irresistible. With so many credit card companies offering various schemes and services, it is not
always easy to select a card that suits one's needs. There may be instances when consumers get confused
about the various offers. In such instances, it is very easy to make wrong decisions and finally suffer
the consequences of selecting the wrong card.
Before planning to buy a card, one must ask some basic questions to oneself. One needs to know how one
is going to use the credit card. Similarly, will it be used to consolidate debts? Will is be used to make
business purchases? Is it primarily used to save money? or will it be used to make cash advances? Having
clear answers to all these questions will help a lot to select a good credit card.
One of the main characteristic of a card that needs to be analysed before buying it, is the APR. Since
the APR effectively decides the cost of services of the card, cards with higher APRs have to be avoided
in favour of those with lower APRs. Similarly, customers will be benefited if they research on variable
APRs offered by some card companies. Although companies may try to highlight the advantages of variable
APRs, customers need to ensure that they do not stand to lose when they avail an offer from a card
company on the basis of variable APRs.
Another fee that can add to cumulative costs is the annual fee that companies charge. While premium
cards charge high annual fees, some companies may offer only lower annual fees. Unless a customer wishes
to avail a lot of frills and service benefits from a card company, it is always best to avail a card with
lower annual fees so as to reduce total and recurring costs of ownership.
Another very important feature that needs to be paid close attention is the grace period that cards
offer. While some card companies may offer up to 56 days of free credit for purchases, some cards may
charge a fee from day one of the purchase. Similarly, some cards will offer lower transaction fees, while
some companies may charge higher fees for each transaction. All these fees and costs have to be
considered when one is planning to go in for a credit card. Some of the so called features may be useless
to some customers, while some other features may be useful. Hence, one needs to prioritise one's needs
and then go in for a card that suits one's needs perfectly.
