When used responsibly, credit cards offer incentives, convenience, and security—all of which make them indispensable financial tools.
Nevertheless, with so many options on the market, selecting the best credit card might be difficult.
To help you find the perfect fit for your financial needs, we’ve compiled a list of 11 crucial questions you should ask when selecting the right credit card for you. Let’s dive in.
11 Questions You Need to Ask to Choose the Right Credit Card
1. “Why do I need a credit card?”
First, think about what you want to do with the credit card.
This could be to pay your bills, buy things online or on vacation, or spread out the cost of a purchase. No matter how you use your card, the most important thing is whether you will pay off your balance every month or over a while.
2. “What’s my credit score?”
Credit card companies usually put people who apply for credit into different credit score groups, such as excellent, good, fair, and bad. This tells the company what benefits of the card you can get.
For instance, people with good credit can usually get credit cards that have big reward programs, extra perks, and no foreign transaction fees. People with lower credit scores may only be able to get cards with less free stuff and higher interest rates.
3. “Do I want rewards or low-interest?”
Assess your priorities and decide if a low-interest rate or rewards like cashback, miles, or points are more essential to you. If you frequently use your credit card for a variety of expenses and have a high credit score, rewards cards are fantastic.
Conversely, low-interest cards would be more appropriate for your financial situation if you are repairing your credit score or do not make large purchases. If you plan to carry a balance from month to month, low-interest cards are also an excellent choice because they’ll reduce your borrowing costs.
4. “What’s the annual fee?”
Several cards charge an annual fee.
Unless you pay the entire amount owed, interest will be charged on both the fee and your expenditure. The fee is added to the amount owed. Determine whether a card with no annual charge is a better choice or if the benefits exceed this expense.
5. “What’s the APR?”
This is how much it costs to borrow money on the card if you don’t pay it off in full every month.
For the best deal, you can look at the APRs of several cards side by side. Different cards have different fees, charges, and rewards, so you should compare those too.
6. “Are there introductory offers?”
Certain credit cards provide 0% APR for the first few months on purchases or balance transfers.
This is the part where you either pay no interest at all or a very low rate of interest. After a certain period, the rate rises. For instance, it might go up starting on a specific date or after six months.
For balance transfers, you frequently notice an introductory rate. Consider the duration of the introductory rate and the interest rate that the card switches to at the end of the introductory period when comparing cards.
7. “What about balance transfers?”
Balance transfer credit cards can be a useful tool for people with credit card debt, as they help lower interest rates and pay off debt faster.
It’s critical to take into account elements like:
- costs
- the duration of the introductory period
- and your capacity to settle the bill in full before the promotional rate ends
Additionally, bear in mind that because balance transfer cards are primarily intended for debt reduction, they cannot provide the same features or rewards as other credit cards.
8. “What’s the credit limit?”
Your credit limit has an impact on your purchasing power.
Before choosing a credit card, make sure it fits your needs and spending patterns. You may be able to ask for credit limit increases from certain credit card issuers over time. If you pay your bills on time and handle your card responsibly, your issuer can raise your credit limit.
9. “Are there foreign transaction fees?”
Seek credit cards that provide no foreign transaction fees when you travel abroad to avoid paying for currency conversion.
10. “What additional perks are included?”
If you’re considering two or three very similar credit cards, having the right perks can make the difference.
Do some planning for what you want to do this year and in three to five years.
If you want to save money or occasionally buy something nice for yourself, you might want to look into a credit card that gives you cash back as you spend it.
Have you ever wanted to travel? Maybe you should look into credit cards that offer trip rewards. Perks for traveling can include flight miles and better rates on cars, airport cabins, and lounges.
11. “How’s the customer service?”
When problems happen, a credit card with top-notch customer support might save your life.
Quick and helpful customer support can make it easier to resolve problems with disputed charges, lost or stolen cards, or incorrect billing. Seek out credit card businesses that offer transparent policies and fees along with round-the-clock customer care.
Final thoughts
You should carefully think about your financial goals and way of life when choosing the right credit card.
These 11 questions will help you make a choice that fits your needs and puts you on the path to better money management.
Remember that credit cards can be very useful if you know how to use them correctly. Make sure you read the card’s terms and conditions and build good credit habits to make your future finances safer.