As a general rule, you should ask yourself the following questions when applying for a credit card:
Why do I need/want a credit card?
This will help you decide what features you want your credit card to provide. You may need to transfer balances between cards and will therefore want a card with a special interest rate for transferring, or the card may be needed for business purposes. Being able to earn rewards may be a huge incentive, especially if you already own other credit cards.
How much do I need to charge at one time?
You may need a card which has high or no spending limits. If this is your first credit card, you may wish to choose one with a more modest spending limit.
How do I want to pay back the charge?
The entire balance each month or in portions?
Do special offers interest me?
You need to decide whether these are important to you. >
Which situation suits me best?
- If you pay the balance of your credit card off in total each month, then a low interest rate is not as important as having a card which has no annual fees or additional member and credit card benefits. Similarly, if you will be able to pay off the majority of the bill each month, a low interest rate is less of a consideration.
- However, if you are only able to pay a small portion (or none) of the balance off each month, and the rest will be carried over to the next month (thus being subject to interest), make sure you choose a card with a low interest rate as its main feature. Aim to pick a credit card which has a fixed rather then low introductory rate. The difference between a 5% APR and a 12% APR can be great if you have a large balance, or if you will take a long time to pay it off.
- If you have an existing debt that you want to transfer, make sure you choose a balance transfer card which offers a 0% transfer fee and a lower APR than you had on your previous card(s).
- If you have a poor credit rating or history, opt for a secured card until you can improve your ranking.

