Almost everyone over the age of consent (18 or 21) has or wants a credit card nowadays and they are taken in almost every establishment. There are three major sorts of credit card common in America. The first major kind of credit card is travel and entertainment cards such as American Express or Diners Card. These have to be repaid in full at the end of the month and are generous on spending limits.
The second major sort of credit card is the bank card such as Visa, Master Cards, GM, and Ford cards sponsored mainly by the banks. The bank defines the spending limit, which in bank parlance, is known as the credit line and each bank offers different terms and conditions. Banks offer a choice of payment means: you may either pay the balance in full with no interest charges or pay the minimum or some part of the balance with an interest.
The other major sort 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 taken in specific countries. They usually do not have annual fees. There is a large variance in the terms and conditions for these cards.
Different kinds of credit cards offer different options. Some are geared toward individual consumers, while others are designed in ways that work best for small business needs. To know what sort of credit card fits your needs, you should review a few options.
How to Select your Credit Card.
Credit cards are a part of everyday 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 of entering into the world of plastic money, here are some of the basic things you should look out for.
First, compare the interest charged on all the credit cards you are interested in. While the rate will not remain fixed for ever, it’s always best for beginners to go for the one charging the lowest rates.
Make sure you study the fine print carefully, especially regarding the other charges that may be applied, like late-payment fees, annual fees, and whether there is a grace period, which is normally given before the finance charges are applied.
You should decide which spending limit is most suitable for someone on your income level. Furthermore, the fewer credit cards you have, the better placed you will be to track your spending pattern.
You should compare the services and other features such as the cash back incentives, or warranties, rebates and the like and check whether the card is accepted widely enough to suit 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 involving the transaction. 3] Period of Grace: This is the period the issuer allows you before he starts charging you interest on new purchases. (Note that not all credit cards have a grace period).
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