Between banks, credit unions, and other financial institutions, there are thousands of credit cards on the market. But even if you find a list of the best credit cards available, it can be overwhelming trying to pick the right one.
If you’ve ever asked yourself, “What is the best credit card for me?” we’ve got a few questions you can ask yourself to narrow down your search.
What is the best credit card for me? Ask these 3 questions to find out
While picking the right credit card can sound complicated, it’s a straightforward decision once you know what you’re looking for. Ask these three questions, and you’ll be closer to picking the right card.
1. What does my credit look like?
Your credit score is a big factor in determining whether you can get approved for a credit card. While some cards are designed for people with poor or fair credit, some of the best rewards cards require a good or exceptional score.
If you have poor credit, it might make sense to apply for a secured credit card, which can help you build up your credit history so that you can get a better card in the future.
If you have fair credit, a card such as the Capital One QuicksilverOne cash rewards credit card may suit you. While this basic cash-back card charges a high APR and an annual fee, you’ll still get 1.5% cash back on purchases.
If your credit score is on the good to the exceptional side of the spectrum, you’ll have a much wider selection of cards from which to choose.
If you don’t know your credit score, you can get free access to your FICO credit score through the Discover Credit Scorecard. You don’t need to be a Discover customer to register.
2. What kind of benefits do I want?
If your credit score is good or exceptional, you’ll have a good chance of getting approved for most credit cards on the market. Consider what type of benefits you want.
To give you some ideas, here’s a quick summary of the main types of credit cards:
- Cash-back credit cards: These cards offer cash-back rewards on everyday purchases. Some even offer bonus rewards in certain spending categories. While some cash-back credit cards offer sign-up bonuses, they’re typically not robust.
- Travel rewards credit cards: These cards offer points or miles that you can use to book flights, hotel stays, and more. General travel credit cards offer rewards you can redeem for just about any type of travel. Airline and hotel credit cards may restrict you so that you can only redeem rewards with the card’s brand partner.
- Low-interest credit cards: You’ll either get a 0% introductory APR on new purchases or balance transfers, or a low ongoing APR. Low-interest credit cards are great if you want to finance a large purchase or transfer a balance from a high-interest card and pay it off over a year or more.
- Store credit cards: These cards offer special rewards or perks with a specific retailer. While most store credit cards are a closed loop — meaning you can only use them at the retailer — others are open loop and can be used anywhere. Store cards are typically easy to get even if you don’t have stellar credit.
- Student credit cards: College students can get one of these unsecured credit cards to help them establish a credit history. Some student credit cards offer special perks for those in school, such as cash back for good grades, or extra rewards for responsible credit behaviors.
- Secured credit cards: Designed for people who are new to credit or have a poor credit score, these cards require a collateral deposit to get approved. Secured cards are common credit-building tools that allow you to improve your credit for free as long as you pay your balance in full each month.
- Charge cards: These cards require you to pay off your balance in full each month. You can’t carry a balance from one month to the next. These cards are uncommon and typically charge a high annual fee.
- Small-business credit cards: With these cards, business owners will earn rewards and other benefits for their company. Business credit cards tend to offer higher credit limits than personal ones and can help you build a credit history for your company.
Keep in mind that some of these cards offer more than one feature. For example, some rewards credit cards offer a 0% introductory APR on purchases and balance transfers. Some secured cards offer rewards.
As you compare credit cards, consider what’s most important to you to narrow down your search.
3. What are your spending habits?
If you want a rewards credit card, it’s a good idea to get one that offers bonus rewards in categories where you spend a lot.
Families that frequently spend on gas and groceries, for instance, might want to choose a card that offers a higher rewards rate on those purchases rather than others.
Take some time to review your expenses over the past few months. You don’t need to count every dollar, but at least get a good idea of where you spend most of your money. Then pick a card that allows you to maximize your rewards based on your spending.
You can consider getting more than one credit card to achieve your goal. For example, I use five different cards depending on where I shop to make sure that I get the most bang for my buck.
Avoid analysis paralysis
With so many great credit cards from which to choose, it can be easy to get overwhelmed by all of the options. If you’re having a hard time picking between two or more cards, consider applying for more than one.
If you prefer not to use more than one card, though, apply for your first choice. You can always replace it with a different card in the future if it doesn’t work out for you. The key is to know what to look for and to make the decision process as simple as possible.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 5.87% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 5.87% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 5.87%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|