Help Me Choose – Credit Cards – Tips/Tricks

Choose a card that matches your needs
The benefits of a card with interest free days
Tips To Spot The Best Credit Card Deals
Avoiding Credit card fees

Choose a card that matches your needs

Before deciding on the features you want in a credit card, it is important that you understand how you plan to use the card and that you know what you’re spending and repayment habits are. This will ensure that you choose the right card for your needs and the cost of the card will be limited to the features that you are using.

Do you struggle to pay off your credit card debt?

Look for a card that has a low interest rate and a low or no annual fee. This will ensure your interest charges are lower giving you a better chance of getting on top of your debt and to start reducing the balance.

Do you use your credit card for everyday spending and pay off the full balance at the end of each month?

Look for a card that offers interest free days so that interest is not charged on your purchases (provided you pay off the full balance each month). You may also want to consider a card with a rewards program. Make sure that you are earning enough rewards to cover the additional cost of the rewards program.

Do you use your credit card infrequently and as a cover for peak spending periods (eg Christmas) or for emergencies?

Look for a card that has a low or no annual fee and a low interest rate and don’t worry about a rewards program. This will ensure your annual fees are kept to a minimum and any interest charges that you may incur will be charged at a lower rate.

The benefits of a card with interest free days

"Interest Free Days" Cards

Many cards offer an interest free period where interest is not charged on your purchases for a period of time. You must pay off the outstanding balance in full by the due date to receive your interest free days. For example, if a credit card offers “up to 55 days interest free”, it means that you can buy something and not be charged any interest for up to 55 days. This is a great benefit, BUT, if you do not pay the full amount due on your card by the due date, then you will be charged interest and you will not receive the benefit of the interest free days.

These cards will generally have annual fees attached to them, so you need to make sure the interest saved and/or the rewards and any other added benefits are enough to make the fees worthwhile. They are also likely to have a higher interest rate, so make sure you pay off the full balance each month.

"No Interest Free Days" Cards

These cards start charging you interest immediately from the date you purchase something with your card. This means that you don't receive any "interest free" days between the date you purchased something and the 'statement' or 'payment due' date. The benefits attached to these cards are that they often do not have any annual fees to pay and they charge a lower rate of interest.

Tips To Spot The Best Credit Card Deals

It is important to remember that your own individual credit needs will play a large part in determining which credit card is right for you. Take a moment to weigh all your options and review some helpful information to help you make an informed decision.

The best credit card offers in the industry advertise low introductory rates on purchases and balance transfers, competitive APR (annual percentage rate), low or no annual fees, and aggressive reward earning opportunities. Ask yourself how you will use your new card. Do you plan to use it often and pay it off at the end of the month? If so, the interest rate will be less of an issue since most credit cards carry a 30-day grace period on new purchases.

Advantages of Rewards cards

Before choosing a rewards card, think about what you purchase most often and apply for the card that will give you the most rewards in return. You need to also weigh up the benefits that you will obtain and compare it to the cost of being a part of the rewards program. If the benefits are greater than the cost, then go for it!

Lower Your Interest Charges with Credit Card Balance Transfers

Like many of us, if you are looking to consolidate your debt or pay-off high interest credit cards, opt for a card that offers a low rate on balance transfers. Look for 12-month introductory rate offers or companies that will extend the introductory rate until you have repaid the balance transferred. This offer will save you more money in the long run. Those with excellent credit may qualify for cards that offer a zero percent interest rate on balance transfers for a full year. You may also want to look for cards that waive your balance transfer fee during your introductory period.

Managing Your Credit Card Balance

The best way to make the most of any credit card offer is to pay off the full balance due at the end of the month. If you are able to do this, then you can avoid interest charges (if you have an interest free days credit card) while giving you the convenience of charging your purchase. You should also consider a card with a rewards program so that you can earn rewards while you use your card. These reward points can be used to purchase goods and services under the rewards program and can often be converted to frequent flyer points.

Low Interest Credit Card Offers

Low interest credit card offers are among the best offers in the business. If you are interested in transferring a balance or simply would like to finance a large purchase on a credit card, you should consider this type of card. Low interest credit cards are also useful if you want to maintain a revolving credit for purchases, cash advances or balance transfers.

Generally speaking, you will find the lowest interest rate offers on credit cards are designed for those with good credit. But whatever your situation, if you are paying interest on your card each month, finding a card with a lower interest rate is a great way to save.

Avoiding Credit card fees

There are many fees and charges associated with credit cards and it is a great idea to understand how your card works so that you can keep your fees and charges to a minimum. Here are some tips to help you reduce your credit card fees.

Choose the right credit card

Decide how you are going to use the card and what you want to get out of it. Choose a card that fits your needs and contains only the features that you want. This will ensure that you are not paying a fee for something that you will not benefit from.

Annual fee

The amount you pay each year for a credit card depends on the number of features and benefits the card offers. As a result the fees charged vary from nothing to several hundred dollars, so it is really important to choose a card that contains benefits that you are going to use.

Generally, a card with no annual fee may have no “interest free” days and may charge a higher interest rate, so make sure you check these details and weigh up whether it may end up costing you more in fees and charges.

Look for deals and special offers from providers where they will waive the annual fee for the first year for new customers. You can also ask your bank if they offer their existing customers any free credit cards (as many banks will link a credit card to a mortgage and may waive or reduce the annual fee).

Interest free period

Balance transfers

It’s increasingly common for card providers to entice new customers by offering incentives such as a low interest rate on balance transfers from other cards. This interest rate can be as little as 0% over a specified time limit - generally 6 months, although a few cards offer low balance transfer rates for the life of the transfer. These are a great way to reduce your interest costs and help you to repay your credit card debt, but make sure you read the fine print and check the interest rate that will be charged after the specified time limit.

Overdue fees

Avoid unnecessary fees, such as charges for an overdue bill or charges made when you breach your credit limit. Make your payments on time and keep track of how much you have charged to your card and you can substantially reduce these fees and charges.