You only need to turn on the television, listen to the radio, or browse the internet to see a new credit card offer being advertised. It’s no surprise that credit card adoption hovers around the 75 percent mark! And while this is certainly alarming, it’s important to remember that credit cards aren’t the enemy if you are choose the right one for you based on the right information.
To help you in this regard, below are some tips to keep in mind when considering taking on a credit card.
What Can You Afford?
The first thing that you need to know is what you can afford. This doesn’t mean that you should think about an average amount that you think you have free each month, it means sitting down and establishing a budget. This budget will need to show your income streams matches against your outgoing expenses and obligations to give you a solid idea of how much you have to spend each month.
If this amount isn’t sufficient to pay the monthly minimum payment when the card is at its maximum then consider looking for an alternative or reducing the credit amount which you apply for until to a manageable and comfortable level.
Read the Fine Print
Just because each of the credit card offers comes with a heavy binder full of terms and conditions doesn’t mean that they aren’t important or that you shouldn’t read and understand them.
Debt consolidation cards often provide the biggest source of complaints when it comes to o fine print. The reason is that the attractive and heavily reduced applicable interest rate is significantly low is that it isn’t ongoing. This means that after a certain period of time, the interest rate will increase back to either the average rate or an agreed upon interest rate which could be even higher than the average.
For this reason, it’s important to read the fine print to make sure that any of the advantages you believe it will provide are applicable to your financial situation. In the example of a debt consolidation loan, you would want to ensure that you could pay the entire debt by the end of the promotional interest rate period otherwise you could end up paying even more.
Will You Benefit From Their Benefits?
Each credit card company will praise the benefits of their rewards program. Whether it offers from the Groupon Coupons page for Experiencias Xcaret, gift cards for grocery items, or even discounted fuel prices, if you can think of it, it’s likely a rewards program benefit. However, before you get wowed by these offers, be sure that you will actually use them.
For example, if your credit card company offers two free movie tickets each month but you never actually go to the movies, don’t sign up just because it seems like a good offer. The same goes for similar offers where you can receive reduced grocery items. Be sure that you shop at those the participating stores and that you will actually buy the applicable items.
The most important aspect of rewards programs to consider is whether or not the points which you accumulate will expire. The most common complaint regarding rewards programs stems from expiring points. What this means as a subscriber is that you could be saving your points to upgrade an upcoming flight to business class, but a week before your flight half of your points expire and you have to start again.
Which card you choose is a decision only you can make, however, these three tips are great ways to be sure you find a card which matches your needs and financial situation and abilities.