How to Find the Best Credit Card

The best credit card meanings may vary depending on your preference. For example, from repayment plan of view the best card is the one that suit your repayment plan. If you plan to repay the outstanding balance in full every month you would probably disregard the interest rate. But a zero or a low APR credit cards means substantial savings if you do carry balances.

Consider developing the selection criteria by finding out all the terms and related costs associated with a particular card. There are low-rate and no-frills cards that don't charge annual fees. But some upscale cards with rewards packages may collect annual fees in exchange for perks, services and other rewards.

Best Credit Cards -- Factors to Consider

No matter what type of credit card you choose, always pick the one that best fits your needs. Just because you have been given zero APR or 0% balance transfer or even a cash back credit card doesn't mean that you have to accept it. Also, if you don't travel very often, a credit card that supplies air miles is not your best credit card.

The following are some factors to consider for comparing different credit card offers before you make a decision:

• Interest rate or APR. If you are going to pay off your credit card balance in full every month, then consider a card with no annual fee. There will be no interest charges because you will be paying off the credit every month. But if you do carry a balance in your credit cards, then a card with a low interest rate can save you a lot of money. Major companies like Visa, MasterCard, Discover, and AMEX, have low interest versions of their credit cards.
• Fixed or variable rate? With a fixed-rate card you can expect interest rates to be more stable for a relatively longer period of time compared to a variable card. But you need to know the lowest-possible levels that interest rates could fall to predict the interest rate in the future.
• Grace Period. How long or short a grace period is for settling balances is another factor. Since interest charges kick in when the grace period lapses, a company offering longer grace periods provides a longer interest free period before your next card purchases are penalized.
• Transaction Fees. If you will need cash advances, then you should consider applying for a credit card that will offer you both a lower APR and a lower transaction fee.
• Penalty policies. Be aware of all penalty policies covering missed payments, purchases exceeding the limit or balance transfers. For example, First USA and other providers have a $35 ceiling for such transfers, while Citibank has a $50 cap.
• Reward programs. Visa, MasterCard, Discover, or American Express and other big companies have reward programs. They give you special privileges for being a credit card holder. Some of these programs include frequent flyer programs. If you are quite a traveler, then a credit card with this program might be for you. Some offer cash-back options. Most common are discount offerings at retail stores or online chains.
• Annual fees. The annual fee is another important consideration. If you are going to pay off your credit card every month, then consider a credit card without an annual fee. Also, if you think that the annual fee is way too high compared with the privileges you get from your card, it would be probably better to stop using the card.
• Member benefits. Credit cards promise various benefits. Some have travel protection as part of the benefits, while others offer roadside assistance. You have to consider your lifestyle in checking out a card's benefits.

Best Credit Card -- If You Have Bad Credit or No Credit

Have never applied for a credit card before or have a bad credit rating? If so, you may find it difficult to get a low interest rate. If this is the case, you’ll find other offers that will give you what you need. With bad credit or no credit, you will need to look into secured credit cards or debit cards.

A secured credit card company requires you to open an account and maintain some cash balance in that account -- as a security for the company. By using a secured credit card in a disciplined way you establish or rebuild your credit rating. Once you have had your credit card for period of time and begin to establish credit or reestablish credit, you’ll be able to go back and apply for credit cards that offer a lower interest rate.

So with your needs and preferences in mind ask your family and friends for a review of their best credit cards. Look at several of the credit card companies and compare their offers to find the best credit card deal. By listening to their experience and reading online reviews you won't make the mistake of just taking the first credit card offer.