Comparing Credit Cards

When shopping around for a credit card, there are several things that you have to keep in mind. 

What to Look For

You will have to compare the interest rate, introductory rate period, annual fee, default rate, credit limit, and perks.

Annual Fee

Shop around for the best deal.  The best deal includes cards that have NO annual fee.  Annual fees require you to pay a fee each year to use the card.

Credit Limit

If this is a first time credit card or you have had problems paying off a credit card in the past, try a lower limit credit card.  Reserve higher limit cards for when you are financially able to pay off larger amounts.  Higher limits are great for building credit, so long as you pay off the balance every month.

Default Rate

Miss a payment and you may have to start paying the default interest rate.  The default interest rate is usually a lot higher than the interest rate.  Typical default rates range from 22% to 35%.

Interest Rate

Look for the lowest interest rate possible.  Low rates are 14% or under.  Most credit cards have a fixed rate.

Introductory Rate Period

Many credit cards are offering zero to 10% low interest rates for a specific period of time - usually 60 to 90 days.

Perks

Also look for a card that will give you cash back, sky miles, or points towards free items.  Make your credit card work for you.  You can earn anywhere from 1% to 5% cash back.  Or you can earn miles for flights and even redeem points for cd players, gift cards, and more.