Almost everyone over the age of consent has or wants a credit card these days and they are taken in almost every establishment. There are three main sorts of credit card in use in America. The first major sort of credit card is travel and entertainment cards such as American Express or Diners Card. These have to be paid in full by the end of the month and are liberal on spending limits.
The second major kind of credit card is the bank card such as Master Cards, Visa, GM, and Ford cards sponsored mostly by the banks. The bank defines the spending limits, which in bank speak, is known as the credit line and each offers different terms and conditions. Banks offer a selection of payment methods: either pay the balance in full with no interest or pay the minimum or some part of the balance with a finance charge.
The other major type of card is the retail store card, such as Sears, J.C. Penney, Shell or Mobil. These store cards and those from gas companies, widely known as fuel cards, are only accepted in specific countries. They usually do not have annual fees. There is a wide variance in the terms and conditions for these cards.
The various sorts of credit cards present different opportunities. Some are designed for individual consumers, while others are designed in ways that work best for small business needs. To know what kind of credit card fits your needs, you should look over a few options.
How to Choose your Credit Card.
Credit cards have become a part of life for most people living in the western countries. It’s becoming increasingly impossible to avoid them, especially for business men. So, if it is the first time you are thinking to enter into the world of plastic money, here are some of the basic things you should look out for.
First, compare the interest chargeable on all the credit cards for which you are eligible. While the rate will not remain fixed for ever, it’s always advisable for first timers to go for the one charging the lowest rates.
Make sure you study the fine print carefully, especially regarding the other charges that can be made, like late-payment fees, annual fees, and whether there is a grace period.
Decide which spending limit is most appropriate for a person of your income. Furthermore, the fewer credit cards you use, the better placed you will be to understand your spending pattern.
You ought to compare the features such as the cash back incentives, guarantees, rebates and such like and check whether the card is taken broadly enough to fit in with your requirements.
You will do yourself a favour by familiarizing yourself with the following terms: 1] Annual Percentage Rate: this is the measure of the annual cost of the credit. 2] Finance Charges: these are the total charges of the transaction. 3] Period of Grace: This is the period the issuer gives you before he starts charging you interest on new purchases. (Note that not all credit cards have a grace period).
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