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Applying for any credit card randomly is never a good idea as you won’t be able to get the maximum benefit out of a credit card in this way. Nowadays, credit cards don’t just offer you a credit limit, but these cards come with lots of privileges across different categories and one can get the most out of a credit card only if they have chosen their card wisely. This is why comparing credit cards becomes a necessary step to follow before choosing a credit card and applying for it. There are many important things that you need to keep in mind when comparing different credit cards. From annual fees to reward rates and various other factors, you need to check for all these things carefully so that you don’t make any wrong decisions. To help you out with the process, we are here with a list of factors to consider when comparing credit cards. Keep reading for more information:
Things To Consider While Comparing Credit Cards
The following are some of the most significant factors that you need to keep in mind while comparing different credit cards and choosing the right one:
Eligibility Criteria
Checking the Eligibility criteria for credit cards is one of the most important things to do when choosing a credit card for yourself. Different credit cards may have different eligibility requirements and it makes no sense if you apply for a credit card which you are not eligible for. It is because your application will be rejected and it will impact your credit score in a negative way. Therefore, your first step while choosing the right credit cards should be to check the eligibility criteria of different cards and filter out some cards for which you are eligible. Premium and super-premium credit cards generally have strict eligibility criteria compared to basic or entry-level credit cards. So, if you have a high income and a good credit score, you should check for premium credit cards, and if you are having a low income or an average credit score, you should check for basic cards.
Annual Fees and Other Charges
The annual Fee of a credit card is also a very important factor to be considered when comparing different credit cards. Some people want premium cards that come with a high annual fee and exclusive benefits, however, others might just want a basic credit card for their everyday spends. So, you should first understand your requirements in order to decide what type of credit card you want. If you are looking for some premium benefits like complimentary lounge access, golf benefits, free hotel memberships, etc, you should go with premium credit cards. On the other hand, if you want an affordable credit card with basic reward rates and discount offers, you can go with the low annual fee cards as well. Filter out some best credit cards that seem to suit your requirements and then look for a credit card that seems to fulfill all your needs with the minimum annual fees.
Along with the annual fee, you should also check the interest rates and other charges of different credit cards. Also check for the forex markup fee if you make international transactions very often as in this case, a credit card with a low forex markup fee will also help you save a lot. You should also keep the annual fee waiver conditions in mind as a credit card with a high annual fee may also come with a basic fee waiver condition that can easily be fulfilled.
Check The Reward Rates
Nowadays, the reward rates offered with different credit cards have become the major reason for people’s attraction to credit cards. You should also check for the reward rates of different credit cards once you have checked their eligibility and annual fees. You should check for the regular reward rate as well as the accelerated reward rates. Many credit cards offer an accelerated reward rate on certain categories and you should make sure that you get a credit card that seems to offer the best reward rate on a category where you are going to spend the most using your credit card. Not just the reward rates, but also check for the reward redemption options as it makes no sense if you have accrued thousands of reward points but there is no redemption option for your use.
Additional Offers and Benefits
Apart from the reward points/cashback, there are various benefits and privileges that credit cards may offer. For example, you may get free airport lounge access, exciting discounts on dining and movies, and many more such benefits. So, once you filter out a few credit cards on the basis of the above factors, you should now check which of these cards offers the maximum additional privileges. Your ultimate goal should be to find a credit card that fulfills most or all of your requirements with the minimum charges.
Bottom Line
Choosing a credit card is undoubtedly easy, but choosing the best credit card for yourself might be a challenging task. You should never apply for any random credit cards as it can not only impact your credit score, but you won’t be able to get the maximum benefit out of a credit card in this way. Just make sure that you keep all the above-mentioned factors in mind and find the perfect credit card for yourself as per your requirements. In case of any further doubts, feel free to ask us in the comment section below!
