Choosing the Best Credit Card Offers to Meet Your Needs

Choosing the Best Credit Card Offers to Meet Your Needs

by Noreen Ruth

With card offers filling up your mailbox and every retailer ready to have you fill out at application, how do you choose what's best for you? The following explains some of the benefits of the various offers to help you decide.

Standard Credit Cards
These are your run of the mill credit cards--unsecured and available from almost every bank or financial institution. The interest you'll pay to use these cards varies depending on your credit history and how you plan to use it. A low interest introductory period is often offered to catch your eye. This can be an advantage when you make a large purchase because it gives you time to pay it off at a lower rate. Be sure you understand how the rates and fees will increase after the introductory period as stated in the terms and conditions.

Reward Program Cards
There's a reward program for just about every interest, hobby or business--from airlines to telephone companies. The typical reward program pays 1% cash back or equivalent value in a gift card or merchandise. Additional rewards are sometimes given for purchasing from the issuing or select merchants. For example: purchasing from Amazon.com with an Amazon credit card earns double the reward points. Airlines offer points to be redeemed for airline travel. Due to the cost of running such programs an annual fee is often applied to the card. Be sure to read the terms and conditions to reap all the benefits of being enrolled in the program. Reward credit cards are a great deal for those who pay off their balances each month as its like money in the bank.

Balance Transfers
Balance transfers are another gimmick offered for a savings to you, as long as you understand the terms and conditions. If you transfer a balance from a high interest rate credit card to the lower rate card offered, there is usually a transfer fee and sometimes a time limit at the lower interest rate. Be sure that you're really benefiting by adding all the costs up before you make the transfer.

Cards for Consumers with Bad Credit
The easiest credit card to qualify for to help rebuild or repair a damaged credit rating is the secured credit card. Collateral of some sort, whether a security deposit, jewelry, stocks or other items of value, is used as a security deposit against the credit amount being applied for. Typically, the value of the item needs to be of equal or greater value than the amount being borrowed. A low credit line of less that $250 is often available to those who need help rebuilding. These carry additional charges and penalties but can help you overcome the credibility problem you may have with lenders and get your credit back on track.

Prepaid Credit Cards
One last consideration in handling a bad credit situation is the prepaid credit card. These work like a debit card in that the amount available is already secured by having paid upfront. The risk of running up your debt is eliminated by using these cards. However, there are fees that may apply such as startup, over limit, ATM and more. Be sure to read the terms and conditions carefully.

Specialty Credit Cards
Business cards are specialty credit cards offered to meet special credit needs of businesses. Like traditional cards they offer rewards, low intro rates, balance transfers, etc. There are additional benefits that may make these offers attractive: additional cards for employees, business rewards, separate expense reports for business and personal purchases and higher credit limits. Student cards are offered to begin the process of building a healthy credit history. The credit limit is kept low to help the first time card user become accustomed to a monthly pay-off or payment.