In reality, there is no one best credit card. They come in so many types with so many features. The choice depends entirely on how you’d be using the card. Do you plan to use it for your day-to-day purchases or will you confine it only to large major purchases? Are you planning to pay off your balance each month on the due date or would you be using the grace period that comes with it?
In applying for a credit card, make sure you take into serious considerations the following items:
1) Annual Percentage Rate (APR) : This is the amount of interest slapped-on an outstanding credit card balance. APR comes either variable, which fluctuates with the economy or fixed APR which is set by the credit card company and does not go up or down. . APR can range from 7.99% to 30.25%.
2) Annual Fee: While most credit cards don’t charge any annual fees, some have assigned fees each year for being a cardholder.
3) Grace Period: It’s that period of time where a transaction does not accrue interest. This generally goes from 0-30 days or on the average, 23 days and most times applies only on purchases and not on cash advances or special transactions. Go for a credit card that offers at least 25 days.
4) Cash Advance – This is really an immediate cash loan that you can get out of your credit card and may have a higher APR than your ordinary purchases. With some credit cards, making a cash advance comes with a transaction fee and for which a grace period will not apply.
5) Penalty APR : This is a punitive, much higher APR that’s applied on cardholder’s account that went beyond the credit limit or had late payments or otherwise regarded as being in bad standing. Don’t get any credit card that’s got penalty APR.
6) Credit limit: It’s the maximum amount that can be maintained at any given time and it’s smart not to go beyond this so you don’t get penalized.
7) Transaction fees: Credit cards may or may not have this. It’s really an additional fee charged on transactions other than ordinary purchases. Sometimes a minimum fee applies. Other cards may have this as a percentage of the special transaction, as a cash advance.
8) Minimum payment: On a monthly basis, it’s the amount of money that’s got to be paid on the account to maintain what’s been agreed upon in the credit card contract. This will also help you avoid late payment fees.
In Case of Lost or Stolen Credit Card
In such a situation, it’ll make practical sense for you to immediately call the company that issued the card and report it as lost or stolen. Once you’ve done this, you have no further responsibility for any unauthorized transactions made on the card. In any event, federal law says your liability can’t go beyond $50.