Almost everyone over the age of 18 (or 21) has or wants a credit card these days and they are accepted in almost every establishment. There are three major types of credit card in use in America. The first main type of credit card is travel and entertainment cards such as American Express or Diners Card. These have to be repaid completely by the end of the month and are liberal on spending limits.
The second major sort of credit card is the bank card such as Visa, Master Cards, GM, and Ford cards distributed mainly by the banks. The bank defines the spending limit, which in bank speak, 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 a finance charge.
The other major sort of card is the retail store card, such as Sears, J.C. Penney, Shell or Mobil. These store cards and the ones from gas companies, which are known as fuel cards, are only accepted in specific countries. They usually do not have annual fees. There is a wide disparity in the terms and conditions for these cards.
Different sorts of credit cards offer different options. Some are geared toward individual consumers, while others are set up 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 Choose a Credit Card.
Credit cards are a part of everyday living for most people living in the west. It's becoming increasingly impossible to avoid them, especially for business men. So, if this is the first time you are about to enter into the realm of credit cards, here are some of the basics you ought to 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.
Read the fine print carefully, especially on 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.
Decide which spending limit is most suitable 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 accepted broadly enough to fit in with your requirements.
You will help yourself by acquainting yourself with the following terms: 1] Annual Percentage Rate: this is the annual cost of the credit. 2] Finance Charges: these are the total charges involving the transaction. 3] Period of Grace: This is the length of time the card issuer gives you before they begin charging you interest on new purchases. (NB: not all credit card issuers offer a grace period).
No related posts.
