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Your Guide to Picking the Best Credit Card for 2020*



With 2020 around the corner, you're looking for a fresh start for everything — including your credit card. You may wonder which one to get with so many choices on the market. How can you choose the right one to suit your income and spending habits? Luckily, knowledge and foresight can help you answer this question. Keep reading to discover factors to look for when selecting your credit card.

Credit Score
Your credit score decides what kind of card you can apply for. Individuals with high scores can apply for cards with higher credit limits and better rewards. Factors like payment history and credit diversity determine your rating. Always send payments on time and open multiple credit lines if possible.

Types of Cards There's no shortage of cards to pick, and arguably, your major task is choosing the winner. Popular varieties include secured, unsecured and business. Secured cards set a limit based on however much money you deposit into a credit line, such as $300. You'll receive your money back when you build your score and prove to be a trustworthy spender. Unsecured cards don't require you to deposit your own money — they work like regular credit cards.

Business credit cards let corporate or small companies spend money and earn rewards on things like travel mileage. Small business cards allow starting entrepreneurs to build their credit history until they can upgrade to corporate. Every card issuer defines "business" differently — ensure yours fits the bill before applying.

Annual Percentage Rate
If you carry a balance each month, your APR determines how much interest you'll pay. A low APR rate is better for those who rarely pay off their entire bill — you won't have to deal with added fees. The card you choose will either have a fixed or variable rate, which defines how much interest will accrue. If your chosen card has a variable rate, you may have to pay different interest amounts depending on the transactions you make.

Credit Limit
The credit limit determines how much you can spend. A limit of $400 means you can make up to $400 in charges — likewise for $10,000 or $20,000. Your credit history and income level determine this number. The more you can afford to pay off, the higher you can set the limit. Your chosen limit should be reasonable compared to your income. Having too much leeway with spending can cause you to go above your means and take longer to clear your debt.

Extra Fees 

Consider the additional fees you'll encounter as you use your card. Most people are familiar with late fees, but you also have the annual fee, balance transfer costs, convenience charges and more. You'll pay additional money for out-of-country transactions or payments surpassing your credit limit. These expenses make it clear why using your card wisely is crucial. If you manage your debt and consistently pay on time, you can avoid many of the higher costs.

Apply for Your Ideal Credit Card
Choosing the right card can be straightforward if you know what to look for. Nail down your preferences, and you'll be ready to apply in no time. Celebrate 2020 with a new card and a new lease on life.

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