RSSHow to Compare Credit Cards
September 11th, 2009 by Adam | Filed under Credit Score, Credit Score Advice, Credit Score Tips.|
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When there are so many credit cards on offer all claiming to be the best, comparing credit cards can seem like a scary task. How to get started?
It will help a lot if you first figure out the reason for obtaining a card before you start doing credit card comparison. You must be honest with yourself about this, because the best credit card for you is the card that matches your needs. These serve as the criteria against which you evaluate the various credit card features.
In looking for the best credit card deals, these things should be considered:
Interest rate. Look particularly for the rate that will be used to calculate the finance charges every billing cycle. Pay close attention to the default interest rate — the rate imposed when payments are late and credit limits are exceeded. This rate is above the standard purchase APR or interest rate.
The Balance calculation method. If you intend to carry a balance, make sure you understand the card issuer’s manner of computing the balances on which interest will be charged. The methods that produce the lowest interest are the adjusted balance and average daily balance excluding new purchases.
Balance transfer opportunities. Offers of very low introductory rate for a specified period are intended to entice you to transfer balances from a competing credit card. Once the offer period ends the interest rate normally reverts to a much higher rate so check this. Credit card comparison websites can help you search for cards with the interest rate you are most comfortable with.
Annual fee. The range of annual fees varies widely. Be zealous in your credit card comparison to look for the least fee. Saving money on one feature such as no annual fee might be off-set somewhere else such as higher APR so check the offer with care.
Cashback. Some cards offer cashbacks, varying from 1% to 3%, on your purchases. While it’s great to get the effective discount of 1% it will be wiped out many times compared to paying 14% interest on an outstanding balance.
Late payment and other fees. If your payment comes in late, even for just one day after the due date, you’ll get hit with late payment fee. If you break a card rule then their are often other fees imposed. Credit card comparison is very important to look for the cards with the lowest penalty rates, over-limit fees, and other fees.
Rewards. The best credit card rewards programs require the least number of points to redeem the item you want. Look at the participating establishments where you can earn rewards points with the card, and make sure the places where you shop are included.
Credit Limits. Check how much credit will be allotted to you. Credit card comparison is needed against the amount of purchases you expect to charge to the card on a regular basis. You don’t want to be exceeding the credit limit. Look for a credit limit that’s about three times your expected amount of monthly purchases.
Foreign transaction charges. If you travel a lot and expect to use the card a lot overseas, check out and compare the applicable fees for foreign transactions and foreign exchange differentials.
Cash advance charges. Interest rates and transaction fees for cash advances are usually much higher than normal purchase transactions. Making cash advances should be avoided but it’s worth checking the fees in case you ever have to use it.
This article by Richard from compareyourbank.com.au who compare products including St.George credit cards.
Tags: best credit card, credit card comparison, credit cards