Credit cards can be a useful addition to your wallet, as long as you choose the right card and use it wisely. many Credit card rewards They come with different perks, such as cash back or travel rewards. And if you’re a student looking to get your first card, or if you’re struggling with credit card debt, finding a card that meets your needs can save you time and money. So it is important to know How to choose a credit card This is for you.
Types of credit cards
A rewards credit card is a card that allows you to earn points, cash back or airline miles on purchases. Some cards have a flat cash back rewards rate, while others offer higher points on purchases made in specific spending categories. Fixed-rate rewards cards offer a set percentage of cash back or points on all purchases made with your credit card, good for cardholders who prefer a straightforward rewards structure. On the other hand, tiered rewards cards offer higher earnings on purchases in different categories, such as travel and dining. Using a rewards credit card is an easy way to earn on purchases you actually make.
Redemption options for cashback rewards vary between cards and may include statement, check, direct deposit, merchandise and gift cards. Travel rewards can be used to cover airline, hotel, or other expenses such as car rentals.
Check out Kiplinger’s picks for The best rewards cards for 2023.
Balance transfer and 0% APR cards
A balance transfer card is a credit card that allows you to transfer balances from other accounts to it to avoid paying a high amount April (annual percentage rate). Most balance transfer cards offer an introductory 0% APR for a set period of time to help cardholders avoid exorbitant interest payments on existing debt.
However, balance transfers almost always charge a balance transfer fee of around 3% to 5% on the total amount of debt you’re transferring. Besides credit card debt, some balance transfer cards will let you transfer other forms of debt onto the card, such as auto loans and personal loans.
Similar to balance transfer cards, other cards offer an introductory 0% APR on new purchases, too.
Check out Kiplinger’s picks for The best balance transfer cards for 2023.
For those who travel a lot, choosing a travel card can be a valuable tool. Travel cards are designed to earn points or miles for cardholders that can be used to pay travel expenses. They also come with extra benefits that also entice travelers, such as free checked baggage, rental protection, lounge access, and priority boarding. Also, many of them do not have foreign transaction fees. Some travel cards allow you to redeem points or miles through airline and hotel partners, while others are co-branded for a specific airline, such as Delta or United.
Check out Kiplinger’s picks for The best travel rewards cards for 2023.
Student credit cards are a form of “starter card” for college students with limited credit history. Because they are designed as a way for young people to start building credit, they usually don’t have strict approval requirements or incur annual fees. Many student cards also offer rewards in categories that appeal to students, such as cash back on food and entertainment, while others make reward earning easy with flat-rate cash back for cardholders as they begin their credit journey.
Check out Kiplinger’s picks for The best student credit cards for 2023.
Secured cards are available for those with no or no credit history or generally bad credit card. With a secured card, your credit limit is determined by the amount of cash deposit you make up front, so you’ll still be able to start building a credit history, but the lender won’t have to take any risk on you. These cards usually won’t have the same lending power as most cards, but they’re a great place to start if you’re looking to build credit from the ground up or improve your poor credit score. In fact, some secured cards will automatically upgrade you to an unlocked card if you show a history of good credit management.
Small business credit cards
As the name implies, small business credit cards are used to make purchases and help separate your business and personal expenses. To qualify for a business credit card, you will need to provide basic financial information about your business; Even if your business is in good shape financially, the card issuer will likely want additional assurance that you and your business are good credit risks. For this reason, most small business cards require a personal guarantee, which means that you as a business owner will have a difficult inquiry on your personal credit report, which will likely lower your credit score for some time.
the Best business credit cards Get valuable benefits, such as employee cards, spending reports, and in some cases, cash-back rewards that allow you to earn on purchases your business actually makes.
Store credit cards
Some retailers offer co-branded credit cards. Depending on the card, it can only be used at the associated store, while others can be used anywhere. Store credit cards allow cardholders to access in-store discounts as well as earn points or cash back when shopping at select places. Customers usually have an easier time getting approved with store credit cards than they do with other credit cards, but be warned — store credit cards usually have higher interest rates. Opening a store credit card for a place you shop often can be an easy way to save cash, as long as you pay off your balance promptly.