4 Tips For Choosing The Right Type Of Credit Card

The first question you should ask yourself is, "why am I trying to get this card?" Usually, credit cards can be divided into four categories, each of which should suit your answer to that question.

If you have a comfortable living, and like to travel, airline credit cards and frequent flier cards can be a great investment. You get rewarded for all the non-travel dollars you spend, and if you can afford to pay the balance off every month, you'll actually make money off the card, instead of being charged huge interest rates and finance charges. Beware, however: most airline credit cards do come with an annual fee, and high interest rates. Assuming you travel enough, however, the annual fee will be worth it compared to the frequent flier miles you'll be able to earn. Of course with a card like this you'll need to make sure to pay off the balance each month, otherwise the interest payable and annual fee will eat away at your rewards.

If you're becoming overwhelmed by high balances on a number of credit cards you already have, or simply can't keep track of them all, a balance transfer card could be a lifesaver. These cards often come with low introductory interest rates, which can buy you a little time to breathe while you handle one simple, lower monthly payment. Watch out, though, for the fees applied to balances transferred. Try to find a card that includes a low maximum fee cap so you don't spend more than you're saving.

If you're looking to make a single purchase you simply don't have the immediate cash for, a low interest or introductory rate APR credit card may be the way to go. Because your income is modest, it will take you a longer period of time to pay off the balances, and having as low an interest rate as possible will keep you from digging yourself into a debt trench.

If you have a large disposable income, spend within your means, and never have to worry about how you're going to pay your next bill, Gold and Platinum cards with lovely perks can be the way to go. However, with those lovely perks come higher interest rates, which in turn leads to bigger finance charges on larger balances. So, like our friend the airline card, Gold and Platinum cards can be very rewarding to those whose lifestyles are suited. And again, with a gold or platinum card you'll need to make sure to pay off the balance each month, otherwise the interest payable and annual fee will eat away at your rewards.

Always remember, no matter what kind of card you apply for, you must read all the fine print and make sure you aren't signing up for something you don't understand.

By: Mark T Brown

Article Directory: http://www.articledashboard.com

Mark Brown's no-nonsense manner in dealing with consumer debt and poor financial management is a result of struggling personally with debt. This gives him a unique insight into the such situations. For more information on balance transfer cards, compare credit cards online on the comparison site Credit Card Compare.