What you should look for in a credit card

The world of credit cards has become increasingly competitive over recent years, and many people rely on their credit cards for anything from day to day spending to emergencies or one off, larger purchases.

There are many different credit cards on the market these days, with cards to suit all needs and circumstances. However, no matter what sort of card you are looking for there are certain things that you need to look at and compare in order to ensure that you get the right card for your needs and to suit your pocket.

The different areas that you need to compare and look at with credit cards will depend on the type of credit card that you opt for, as different credit cards will have different benefits and areas that will affect how suitable they are for your needs. Therefore you should make sure that you compare the relevant areas based on the type of card that you opt for.

This can be done with ease, convenience, and speed online, saving you time and hassle and enabling you to find a suitable card from the comfort and privacy of your own home. You can also make your application online once you have found a suitable card, and often you will receive an instant decision on your application.

0% cards

If you are looking to take out a 0% balance transfer credit card or a 0% purchase credit card you should make sure that you compare some important areas in order to find the one that offers the best value and is best suited to your needs. For 0% balance transfer or purchase cards you need to compare the different interest free periods, as the length of interest free credit offered can vary from provider to provider.

Obviously, the longer the 0% balance transfer or purchase period the more time you will have to repay your debt before being charged interest. Of course, the point of these cards is that you repay the balance in full before the interest free period expires so that you avoid paying any interest. However, do take into account the standard variable interest rate just in case.

However, your main priority should be the length of interest free credit available, as you can always transfer any remaining balance onto another balance transfer card if you have not repaid it by the time the 0% period expires.

Low rate balance transfer cards

If you are looking to transfer your high interest credit card balances onto a low rate balance transfer card you need to compare the interest rates offered by the different card providers. With these cards you can enjoy a low rate of interest for the life of the transferred balance, but the interest rates can vary from one provider to another.

You should aim for get the lowest balance transfer interest rate, as the deal is for the life of the transferred balance and therefore you won’t have to compare the length of the deal.

Rewards based credit cards

If you are looking to take out a rewards based credit card then you should be the type of person that repays the balance in full each month, as this is the only way that you can really benefit from these cards. Therefore the interest rate should not be your main priority with these cards.

Instead, you should be looking at the level of rewards offered per pounds spent, what sort of rewards are on offer, and whether there are any bulk rewards or other benefits available when you open your account.

If you tend to spread your repayments you will be charged interest on your debt, and this will counteract any benefit from the rewards that you earn, which is why these cards are not suited to those that do not settle up in full each month.

Charity credit cards

As with rewards based cards these cards are only really suited to those that settle their balance in full each month, otherwise you will be charged interest on your balance and this will counteract the benefits – you might as well make the donation directly to charity yourself and get a 0% purchase card in this case.

However, if you do settle your balance in full each month these cards can prove an effective and simple way to donate to charity. You should look at how much is donated to charity per pounds spent, as this can vary from provider to provider, and also whether any bulk donation is made when the account is first opened.

Bad credit credit cards

Unfortunately most bad credit credit cards do not offer any benefits as such, as they are designed to help consumers rebuild their credit. The one thing that you should look out for with these cards is the rate of interest charged, as this can vary from one provider to another.

Although the rate of interest on bad credit credit cards is typically higher than on standard cards, it can still vary and it is therefore advisable to compare rates and find the lowest rate possible.

However, wherever possible you should just use these cards to provide ease, convenience, and improve your credit through timely and responsible repayments, and you should try and settle your balance in full each month to avoid having to pay the high rates of interest.

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Consolidating your credit card debts

Credit card debts cab cause a lot of financial stress simply because it is so easy to accrue debt on these cards, and it can take forever to repay them if all you can afford is the minimum repayment each month. On top of this, the high interest rates charged on credit cards can really hit your finances and you ability to repay the card balances more quickly.

If you are the kind of person that uses the credit card to make purchases and then repays the balance at the end of each month then there is no problem, as you get to enjoy the convenience of a credit card without the financial implications of being charged high levels of interest – no interest is charged if you repay the balance in full within the specified period.

However, for many people credit card spending isn’t quite that simple. It seems to take next to no time to actually accrue a huge balance on the card, and it seems to take an eternity to actually repay it. With a large chunk of your monthly repayment being swallowed up in interest you could find that you are barely impacting on your principal balance if you are only able to make small repayments on your card each month.


Various debt management solutions

There are a number of solutions available to those looking to consolidate their credit card debts in order to reduce repayments and interest and make repayment of the debts more manageable. If you have a number of credit cards you are most likely paying a lot of interest as well as having to deal with making a number of repayments each month. By consolidating these you could cut your repayments, enjoy easier budgeting, and reduce the interest that you pay.

One of the solutions available for those looking to consolidate their credit card debts is through a debt consolidation loan, which can be used to consolidate a variety of other debts in addition to credit cards, such as catalogues, store cares, and other forms of credit. Another solution available is by transferring the balance of your credit cards to a 0% balance transfer credit card, which will enable you to benefit from a set interest free period to try and clear more of your balance.



There are a number of benefits and drawbacks to using the 0% balance transfer credit card. Some of the benefits include:

1.

Being able to transfer all of your credit card balances onto one card, thus making financial management and budgeting easier and more convenient
2.

Benefiting from an interest free period during which time you can make more of an impact on the principle balance of your credit card debt, rather than watching large chunks of your repayments go towards interest payments
3.

Enjoying a choice of 0% balance transfer cards from a range of lenders and financial institutes, giving you more choice and a better chance of finding the right card for your needs
4.

Some of the things to look out for and bear in mind include:
5.

Some 0% balance transfer credit cards charge administration fees and annual fees
6.

You will usually need a good credit rating in order to qualify for a credit card that offers this type of facility
7.

You will need to be able to get a credit limit that enables you to transfer all of your other credit card balances on to the card in order to cut back on the amount of interest you pay
8.

If you find it hard to stop spending on credit cards, you will still have the temptation of a card if you use this method to consolidate your other credit card debts



If you do plan to transfer your existing credit card balances on to a 0% balance transfer card you should make sure you compare the cards on offer, and find a fee-free transfer card that will not charge you for the privilege of transferring your balance. Also, compare areas such as the period of interest free credit offered, as the longer this is the more time you have to make a real impact on your credit card balance.


Reducing your credit card spending

For those with willpower curbing spending on a credit card may not be a problem, but for many people the temptation can be all too much and before you know it you’ve suddenly accrued a huge balance on your credit card and are faced with the prospect of repaying it all – and at very high rates of interest. There are a few ways to try and curb your credit card expenditure, and these could help to stop the debts mounting up on your card.

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Keep your card somewhere safe for emergencies or to take with you on vacation but don’t carry it around with you all day everyday, as this can help to keep your usage of the card down
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Set up a direct debit or standing order with your bank so that a set amount – as much as you can afford each month – is repaid on the credit card automatically, keeping the balance lower
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Keep a close eye on your credit card expenditure and monitor how much you are spending so that you don’t go over your limit and incur hefty charges – and to try and control your credit card spending a little more
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If you have a number of credit cards with balances, transfer the balances to a 0% interest balance transfer card If you think that you might use the available credit on the card as quickly as you are paying it off, simply cut up the card and dispose of it safely so that the temptation is not there and continue making the repayments on your transferred balances at 0% interest for the specified period.
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Consider using a debt consolidation loan in order to pay off your credit card debts, and once this is done cut up and safely dispose of your credit cards to eliminate temptation.



Further reading: Finding the right person for credit counseling and what to look at when examining debt counselors and organizations.

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