choosing the best credit card
Choosing the Best Credit Card
With a little research and some good judgment, you could save up on a lot of money in fees and interest on credit card payments. Read ahead to know more...
- Balance Transfers - If you have balance on your card, then you can convert this into a 0% deal. However, this deal will only be applicable for a certain amount of time or until the balance is paid off in full. So, if you are planning on making any purchase on the card, you should first check to see what the interest rate is before you get charged. Also check if any fee is charged for transferring the balance.
- Rewards - There are many offers and incentives like loyalty points and cash back offered by many banks today. These are offered to attract new clients. However, it is advisable to first check the rates of interest charged as the levels of cash back are generally very low, and since you will be paying higher interest, this equation won't balance out. It isn't worth paying higher interest rates just for loyalty points or cash back offers, if you are not planning on redeeming them or if their monetory value is relatively low.
- Repayments - The monthly minimum repayment amount on most cards range anywhere from 2% to 5%. If you choose a card that has low minimum monthly repayments, then you should know that it could take you a pretty long time to pay back that balance, which in turn will cost you more in the bargain. However, if at all you miss a monthly payment deadline, then you will probably be penalized. The best way to avoid the risk of a missed payment is to go ahead, and set up a direct debit for the minimum monthly payment amount. However, if the funds are insufficient in order for the direct debit to be paid, then you will have to face the penalty fee.
- Cash - If you feel the need to withdraw cash from your card, then first check the rate of interest being charged. This will always be higher than the interest rate applied for ordinary purchases.