What to Look for In Credit Card Specials

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There are literally thousands of credit card special offers to choose from every day. Credit card companies work hard to make their credit card the one you will choose to put in your wallet. When you're bombarded with offers, it's important for you to do some homework before you make your final choice to ensure that the card you choose is the best fit for you and your budget.

Anatomy of a Credit Card Offer

It's only a small piece of plastic, but it takes pages and pages to describe just how your credit card works. Understanding interest rate calculations, annual fees and specials charges is just the start.

All credit cards, from student credit cards to VISA credit cards, possess common characteristics that impact your budget and determine just how much it will cost you to use your card. The Federal Reserve Board offers consumers insights into your credit card's most important features:

  • The Annual Percentage Rate (APR) for purchases
  • Interest rate for cash advances
  • Interest rate for balance transfers
  • Minimum interest charges
  • Penalty interest rate hikes
  • Set up and maintenance fees
  • Transaction fees

A thoughtful examination of Federal Reserve Consumer Credit Advise will help you get a clear picture of the anatomy of your credit card.

Shopping for Your First Card

If you are shopping for your first credit card, there are a couple of things you should consider before everything else:

  • Choose the card that offers the lowest interest rate you qualify for.
  • Choose the card that calculates interest based on your average daily balance.
  • Choose the card that has the lowest annual fee and associated charges.

Check out one of the many websites that allow you to do a side-by-side comparison. Student credit cards are also available for comparison on these sites.

Once you have narrowed down your choices, look for a card that pays you back by offering benefits you will use. This could be any number of things, including free collision insurance for a car rented with your card, extended warranties on items purchased using your card, or discounts on items you buy frequently.

Checking Out the Very Tiny Print

It's easy to overlook some of the details that are often referred to as "the fine print." Most of us assume that this is mainly legal information. However, within the fine print is a description of not only your interest rates and fees, but your card's hidden perks as well. This includes those perks most credit card owners are unaware of. Every card is different, but some common fine print treasures include:

  • Travel insurance
  • Car rental collision insurance
  • Discounts on tickets to major attractions
  • Low or zero fee international currency exchange
  • Identity fraud protection

Most cards offer at least a few of these perks. Compare the fine print offerings and choose the ones that suit you best.

Also locked inside the fine print is a description of penalties that can cost you big money. Pay close attention to these possible budget-busters:

  • Late fees
  • Transaction fees
  • Live transaction fees
  • Interest rate hikes for late payments
  • Card cancellation penalties

Making Your Choice

For most of us, the cost of use should be our foremost consideration. If you will be using your card frequently, be sure you aren't paying more than you should by choosing the card with lowest possible interest rate and annual fee.

With so many special offers available, you are sure to find the perfect card for your lifestyle and budget.

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Please note your financial situation is unique and our tips & advice presented here may not be appropriate for your situation. CreditCardXpo.com recommends that you seek different advice & opinions from your own accountant or financial adviser who understands your individual circumstances before making any important decisions or implementing any financial strategy.