How To Pick The Best Credit Card: Follow These 5 Easy Steps

Are you having issues with how to pick the best credit card for yourself? Having the right credit card comes with a lot of benefits. More so, it saves you some worries. However, you can find the best fit for your spending habits and goals if you are aware of your options and ask the right questions.

How To Pick The Best Credit Card
How To Pick The Best Credit Card

Importantly, there is no single credit card that is superior to all others in all categories — or for all people. You can find the best credit card for your spending habits and credit situation by understanding your options and asking the right questions.

How To Pick The Best Credit Card

If you’re looking for a new credit card, you might be overwhelmed by the hundreds of options available in the market. There are seemingly endless varieties of cards offering rewards, no-interest periods, and the opportunity to build credit, making it difficult to choose the right one for your wallet.

Because there is no such thing as a one-size-fits-all credit card, the best credit card for you may differ from the best credit card for your friend. However, there are some steps you can take to help narrow down your options when looking for a new card.

Tontimes discusses 4 simple steps you can take to select the best credit card for you.

5 Easy Steps on How To Pick The Best Credit Card

How To Choose The Best Credit Card
How To Choose The Best Credit Card

Choosing the best credit card is a combination of art and science. However, to find the best credit card for you, follow these four steps.

#1. Check your credit Score: how to pick the best credit card

Check your credit score to see what credit card offers you might be eligible for. The higher your credit score, the more likely you are to be approved for cards with better benefits. You can check your score in a variety of ways, including:

  • Some companies provide free credit score access.
  • Many credit card companies provide free FICO scores to cardholders.
  • Credit scores are available for purchase from the three major credit bureaus (Experian, Equifax, and TransUnion).

Check your credit reports to see what’s causing the problem if the number isn’t what you expected. You can then start thinking about ways to improve it, such as changing your spending habits or disputing an error on your reports, if necessary.

Every 12 months, you are entitled to one free copy of your credit report from each of the three major bureaus under federal law., a federally authorized website, offers free credit reports.

#2. Determine Which Type of Credit Card you Need: how to pick the best credit card

Credit cards are classified into three types:

  1. Cards that can assist you in improving your credit when it is limited or damaged.
  2. Cards that help you save money on interest.
  3. Cards that earn points.

The best card for you is one with features tailored to your specific requirements. If you don’t travel frequently, for example, the best travel card in the world won’t help you much.

If you want to improve or rebuild your credit: Credit card for students or secured credit card

Student credit cards, which are unsecured cards designed for college students who are new to credit, are easier to obtain than other types of credit cards. Secured credit cards, which typically require a security deposit of $200 or more, are also available. When the account is upgraded or closed in good standing, your deposit is returned to you.

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If you want to save money on interest, do the following: Card with a low-interest rate, 0% APR, or balance transfer

If you plan to use your credit card for emergencies or if you have an irregular income and carry a balance from time to time, a card with an introductory 0% APR and ongoing low-interest rate may be a good fit for you. A balance transfer offer may enable you to repay a high-interest debt interest-free. Keep in mind that if you have average or poor credit, you may have a more difficult time finding these offers.

If you want to earn rewards: you can do so through rewards, travel, or cash back.

If you pay off your balance in full each month and never incur interest, a rewards credit card is a good fit for you. These cards typically have higher APRs but larger sign-up bonuses and offer points, miles, or cash back on every dollar spent.

#3. Ask the Right Questions to Narrow your Options: how to pick the best credit card

Before choosing a credit card, ask some relevant questions as listed below depending on what you are looking for.

For secured and student credit cards:

  • Will this card assist me in building my credit? Choose a card that reports credit card payments to the three major credit bureaus. Many secured cards do not comply with this requirement.
  • What is the total cost of opening an account, including the annual fee? The rewards on these cards are typically insufficient to justify the annual fee. Unless you have extremely bad credit, you should be able to avoid this expense. The lower the security deposit, the better for secured cards, though your credit limit may be directly related to how much of a deposit you make.
  • Can I eventually upgrade to a better card? Choose a card that will allow you to build credit and then upgrade to a card with better terms. This makes it easier to keep your card open for longer periods of time, increasing the average age of your accounts in the long run.

For low-interest, 0% APR or balance transfer cards, as the following questions:

  1. What is the duration of the 0% APR period, and what is the ongoing interest APR? Look for a card that gives you enough time to pay off your debt without incurring interest. Consider a credit card with a low ongoing APR if you intend to carry balances for a long period of time.
  2. What is the balance transfer policy of the card? Look up a card’s balance transfer fees if you’re doing a balance transfer. Find out what types of debt you can transfer and whether there is a maximum amount you can transfer. It should be noted that the balance transfer APR on a card may differ from the purchase APR.
  3. Is the card reloadable? If you only need a few months of 0% APR — perhaps instead of a sign-up bonus — you might be able to find a card that also offers generous ongoing rewards.

For rewards, travel, or cash-back cards, ask the following questions:

  • How do I spend my money? Look for a card that offers the best rewards in the categories where you spend the most. Consider getting a card with an annual fee if your rewards earnings will cover the cost. If you intend to use the card abroad, look for one with no foreign transaction fees and chip-and-PIN capability, rather than the chip-and-signature technology that is standard in the United States. This is also true for other types of cards.
  • How difficult is it to use this credit card? Consider a card with flat-rate cash-back rewards if you don’t want to deal with limited award seat availability, spending caps, rotating bonus rewards, and loyalty tiers.
  • How quickly will I earn rewards, and how much money will they be worth?

#4. Look around for the best credit card offers – how to pick the best credit card

Once you’ve determined which type of credit card is best for you, it’s time to shop around for the best credit card deals. Consider bonus categories for rewards cards, the length of the intro period for 0% APR cards, and credit tools for credit-building cards.

Don’t forget to consider fees and interest rates when making your decision. Annual fees, foreign transaction fees, late payment fees, and APRs are all included.

If you can’t decide on just one card, consider submitting a pre-qualification form online to see if you qualify. Because it involves a soft pull of your credit — which does not harm your credit score — you can submit multiple pre-qualification requests without affecting your credit score. Pre-qualification isn’t a guarantee that you’ll be approved for the card, and applying affects your credit score.

If you pre-qualify for one credit card but not another, it can help you decide which card to apply for.

#5. Apply for the credit card with the best overall value

The easy part is narrowing your options, but deciding between two or three similar cards can be difficult. If you’ve already determined a clear winner after Step 3, stick with it. If not, a tiebreaker round will be held.

Look for differences. When all other values are equal, the following factors may distinguish a card:

For 0% APR, low-interest, or balance transfer cards:

  • Debt repayment planner: Some issuers allow you to create your own debt repayment plan on an online portal, which is a useful tool if you’re drowning in debt.
  • No late fees or APR penalties: Certain credit cards waive these fees. This could be useful if you fall behind on your payments.

For rewards, travel, or cash-back cards: 

  • Lower required spending: The less you have to spend to qualify for a sign-up bonus, the better.
  • No expiration date on rewards: Some cards allow you to use your rewards as long as you keep the card open. how to pick the best credit card.

For secured and Student Cards:

  • The credit limit is automatically raised: Certain credit cards allow you to increase your limit after a string of on-time payments.
  • Interest has been paid on your deposit: Some secured cards invest your security deposit in a CD that pays interest. You can earn a small amount of money this way.

When you finally decide on a card, keep in mind that you can include all income you have reasonable access to, not just your personal income, on the application. For students, this can include money from grants and scholarships, as well as parental allowances. Others may include the income of a partner or spouse.

You Have Found the best credit card. What comes next?

Choosing the best credit card is a big step, but don’t stop there. To get the most out of your card, use it correctly. Pay your bills in full every month if you’re trying to establish credit, and don’t use up too much of your available credit. If you have a 0% APR loan, stick to your repayment plan.

However, if you want to earn points, use your card for everyday purchases and pay your bill in full each month.

Whether you’re trying to build credit, borrow money, or earn rewards, the credit card you choose should help you achieve your financial goals in the most cost-effective and efficient way possible. Don’t accept anything less. Find the best credit card for you here.

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