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How To Choose Your New Credit Card Choosing a new credit card is not just a personal choice. It's a
lifestyle choice. There are hundreds of credit cards to choose from and savvy shoppers will want to choose credit cards that suit the way they
spend and the things they want to do.
Why Do You Need A Credit Card?
First of all, consumers need to consider why they need a credit card. For example, some people may be using the credit card to improve their
personal cash flow. They could do this by banking your salary, putting
all purchases on the credit card and paying it off before the interest is due. Meanwhile, their salary sits in a current or savings account
earning interest.
Other people may want to use their credit card for occasional luxury
purchases, such as going on holiday or having a day out with some
friends. Still others may use a credit card to pay for purchases where
they want the extra consumer protection many credit cards offer. Paying
by credit card gives consumers some comeback if there is a fault with
the item purchased. This can be useful if manufacturers don't want to
give a refund.
Some people may want to use their credit card to have ready access to
cash, for example when going on holiday. People who are planning to use
their credit cards for cash advances will need to choose a credit card that
has a low rate for this type of transaction.
How Will You Repay The Credit Card?
The next question people need to ask is how they want to make the
payments. If they want to clear their credit card each month, they will
need a different type of credit card to someone who is planning to
clear only part of the balance.
It is also useful to check on introductory rates, balance transfer
rates and any special offers that apply when taking out a new credit
card. Some credit cards offer lifetime balance transfer rates that are
much lower than the standard variable rate. Others offer reductions in
the variable rate for periods of up to 12 months. Still others offer an
incentive for taking out the card, such as cash back or a sports bag.
What Incentives Are There?
Another area to look at is incentives for using the credit card. For
example, some credit cards offer cash back on credit card purchases
which people can apply to pay off the card. Others offer discounts when
the credit card is used with certain manufacturers. Still others offer
the option of making charitable contributions on customers' behalf.
A key area to consider is the annual percentage rate (APR). This is the
rate that customers pay on purchases once the incentive period has run
out. These rates vary considerably, so it is worth
shopping around.
Credit Card Payment Rates And Fees
The minimum payment is another area of concern. Minimum payments on
outstanding balances tend to start around 3% but some may be lower and
others may be much higher. Finally, the interest free period is of big
concern – you'll want to go for the longest period you can get to keep
those payments down.
Finally, consumers need to consider any other fees that might apply to
the credit card account. Some credit cards charge one-off setup fees;
others charge annual fees; still others charge no fees for owning the
card. It's best for consumers to read the small print to see what fees
and rates apply to the cards they have chosen.
About The Author Joe Kenny writes for Credit Card Guide, offering the latest information
on credit cards in the UK, visit them today us to apply for a balance
transfer credit card and start clearing credit card debt
today. Visit today:
http://www.cardguide.co.uk
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