Thursday, August 21, 2008

How to Compare Different Credit Cards

Before you apply for your next credit card, take the time to compare different cards. By making an informed decision you may save yourself money and frustration in the long run.

Step 1
Compare the current and ongoing interest rates of different Credit Cards before you apply. Though many banks may offer a low introductory interest rate, it is important to know how high the interest rate will increase once that period has ended.

Step 2
Look for additional fees, such as application charges or annual fees. Many times lower interest rate credit cards may be offset by a high annual fees or charges.

Step 3
Check to see if the interest rate differs for services such as cash advances or balance transfers. Many times, the rate may be as much as twice the normal APR.

Step 4
Keep in mind that many credit cards charge you additional fees for purchases made in a foreign country. This is a detail not to be overlooked, especially if you plan to travel or make purchases from overseas vendors.

Step 5
Know what the penalty will be if you charge purchases over your credit limit or make a late payment. These fees may be large and they do earn interest.

Compare the Fringe Benefits

Step 1
Find a card that gives you something in return, such as cash back rewards or airline mileage.

Step 2
Contribute to a cause you care about by selecting a credit card that donates to your university or a favorite charity each time you make a purchase. In many cases, your alumni credit card may serve as alumni dues for your alma mater.

Step 3

Find a credit card to suit your personal style. Many companies are now offering different designs for their credit cards.