Kelly Robertson
Credit cards and “scarcity” are not the two terms that should be placed in a single sentence. Quite the contrary, there is a ton of different offers on the internet, and chances are a card that fits your unique needs is somewhere out there. You just have to find it.
That being said, you shouldn’t just sign-up for the first offer that catches your eye. Before pressing that “sign-up” button, ask yourself the following 5 questions to get the very best card for yourself.
1. Can you manage a new credit card?
Chances are if you can’t manage a single credit card account, you won’t be able to manage two of them. There is no magic pill for all your/our financial woes. If you carry a lot of balance on one card with no clear plan how to clear it off, another card won’t help you that much. Except if it’s part of a bigger “get out of debt” plan.
Remember that two cards means two credit card statements and two bills to review and pay every month. We’re not saying this is necessarily a problem, but it could be for some folks.
2. Does the new credit card meet your needs?
If you’re looking to get a rewards credit card, you should compare the reward categories to your existing purchases and your budget (presuming you have one). Does it rewards categories you frequently buy?
Generally speaking, everyone should have a credit card to reward his/her grocery shopping and perhaps the one offering points or cash back on gas purchases. If you live in New York and don’t own a car, you may not need rewards on gas purchases, but you should still strive to get something back on groceries.
On the other hand, if you’re looking to put your debt under control, see if the new credit card you’re looking to sign-up for offers the longest period of 0% APR. Cause it could prove super-useful if you’re trying to clear your debt completely.
3. What are the costs involved with the new credit card?
Specifically, you’ll want to know the interest rate (APR) and additional fees.
Generally speaking, rewards credit card tend to offer a higher APR and if you want to benefit from any points, you should make sure you don’t carry any balance from one month to the other.
On the other hand, those looking to lower their interest payments or get out of debt should look for a balance transfer credit card, which tends to include an introductory period of 0% APR. Make sure to clear that debt out before that period ends; otherwise, you could be slapped with higher than expected APR.
4. Do you qualify for approval?
The rule of thumb is that the better your credit score is the better credit card you can get. The best credit cards are reserved for those with the “excellent” credit score; it’s that simple. Yes, some of these cards include a hefty annual fee, but they still require that excellent score.
The situation is similar with the best balance transfer credit cards. Even though some of them offer up to 21 months of interest free financing, those terms (again) tend to be reserved for the very best customers, with those with “good” or worse credit score getting a lower number of 0% APR.
5. Is this the best offer out there?
Finally, you should shop around and don’t make moves that easily. After all, you will have to deal with consequences for quite some time.
There are many offers circulating around the interwebs these days so before clicking that “sign-up” button, make sure to know what’s being offered. And once you went through all the offers, only then apply for the card that best meets your needs. It’s actually easier than it sounds. Good luck!
