How to choose the right credit card?

22 February 2022
How to choose the right credit card?

Credit cards seem to be becoming more popular each passing day. While some are skeptical, many can’t wait to turn 21 JUST to get their hands on one. Despite where you stand, credit cards can be a useful and powerful tool to payoff good debt and build (and maintain) a healthy credit score. However, in the wrong hands, credit cards have the potential to seriously damage your credit history.

As a result, before applying for a credit card, it is critical to understand everything about it. Choosing a credit card for the first time, you must consider a variety of factors such as offers, discounts, rewards, charges, fees, payment alternatives, services, terms and conditions, and the credit limit. And while no single card is going to be better than the rest in ALL aspects, understanding your options will definitely give you the advantage of choosing the card that best fits your spending habits and credit situation.

Important points to keep in mind

Your reasons for getting a credit card

The additional details you should look for


Improving your CIBIL score

Annual fees and other charges of the credit card.


Enjoying discounts, cashback, and deals on brands

Latest offers available on the credit card 


Purchasing something big and expensive

Maximum credit limit given by the bank on the credit card 


Purchasing expensive products on EMIs


Payment option available to pay the bill of the card

Everyone believes that knowing the card's characteristics and perks is enough to apply for it, but before doing so, you should assess your needs and goals for using the credit card. There are a variety of reasons to use a credit card, you must first determine why you are applying for one. The best card for you is one with features designed to meet your specific needs. If you don't travel much, for example, then the best travel card in the world isn't going to do you a lot of good.

Analyzing your need for a credit card

  1. Increasing your CIBIL Score: You may want to use a credit card just to repair your poor credit history. Individuals having a high CIBIL score can simply utilize the card to raise their score. So that they can take out numerous forms of loans in the future.
  2. Rewards, cash back, and discounts can be earned in the following ways: Most credit cards give discounts and rebates on shopping, flight bookings, hotel bookings, and other activities. So, if you want to earn points and get discounts, you should seek a credit card that does exactly that.
  3. Making Large Transactions: If you wish to buy something expensive but don't have enough money yet, a credit card can help. As a result, choose a credit card with a higher credit limit (and low-interest rate).
  4. Making EMI Transactions: Some credit cards provide an EMI option when purchasing a large item; in this instance, you should choose a credit card that provides EMI alternatives without additional interest.

A handy guide towards applying for your first cc

Annual Fees and Other Charges: If you are selecting a credit card for the first time you should review the credit card's annual fees and renewal fees. You must also go over the conditions for waiving yearly and renewal costs. The requirements for waiving off depend entirely on your spending habits. So, instead of choosing a credit card without first examining your spending, it's a far better idea to analyse your expenses and then choose a credit card.

Don’t also forget to go through charges such as the ones given below: -

• Late Payment Fees

• Cash Advance Fees

• Rate of Interest Charged on the Balance Amount

• GST


Credit Limit: Each credit card has a different credit limit, and an individual's credit limit is determined by their income. So, before you use your credit card for the first time, think about it. Speak with a bank representative and inquire about the maximum credit limit available to you based on your salary or income.

Offers: You should carefully examine all of the benefits your credit card may offer. Broadly speaking these benefits can be categorised as below:

Categories:

• Lifestyle Credit Cards

• Rewards Credit Cards

• Shopping Credit Card

• Travel and Fuel Credit Card

• Business Credit Card

• Professional Credit Card

Offers:

• Discounts

• Cashbacks

• Reward Points

• Fuel Surcharge Waiver

Conclusion

Way to go! You now know how to choose your first credit card. Make a self-assessment of the need for a credit card first, and then review the card's specifications. Look out for the fees, charges, payment choices, and any current offers on the card in the card's specification. You'll undoubtedly choose the ideal credit for yourself after checking through all the retail data.