This post contains informational content based on the author’s personal experiences. This information is not financial advice. Please consult your tax advisor and other financial professionals for advice specific to your situation.
There is a right and wrong way to pick out a credit card if you are trying to get credit cards that are beneficial to your life.
There are plenty of sites like Credit Karma that will suggest credit cards to you, but this isn’t necessarily the best option. This is because on sites like these, you can only pick out a credit card based on the cards that they show you, and the cards that they are showing you are the ones that offered them the best affiliate commissions.
Pick a Out a Credit Card For Your Lifestyle
Consider what you spend the most money on and where you spend the most money at. This will help you better crunch the numbers and decide on a card that will serve you best. There is no point in getting a credit card if you don’t use it.
Consider a Department Store Card
It is easy to just go to a department store and sign up for a credit card, but is that the best option for you? Getting a credit card from a department store can be a great option if you shop at that store often and the benefits of the card are better than other cards you could get.
It is also a great idea if you are just starting to build your credit, because department store credit cards are generally the easiest to get. They also allow you to buy a wider variety of items with them than you could with any other card.
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Visit the Credit Card Sites
Just about everyone knows about Visa and that they are “accepted everywhere”, especially because that is literally their slogan. However, you should also know that in order to find the best credit card to apply for, you should visit Visa and the other credit card companies’s sites directly. This will allow you to see the current offers that they have and will allow you to compare what they normally offer against what you might see on an affiliate site like Credit Karma.
Sites like Credit Karma, Nerd Wallet, and a slew of others are referred to as affiliate sites, because they generally just show you credit card offers from multiple companies on one page on their site.
They will sometimes offer a table to better help you visualize your options and might even go as far as to tell you the best card depending on what type of card that you are looking for.
This is both a great place to do some of your research and a terrible place to sign up for a credit card. The offers can sometimes be outdated or even wrong on these kinds of sites, and because of the way the links to the actual credit card company generally work, you could easily sign up for a card thinking you are getting benefits that no longer exist.
Don’t Sign Up For A Card During the Holiday season
Generally these cards aren’t going to offer you the best perks because the credit card companies know that most people are trying to find ways to buy Christmas gifts, even if they can’t afford them. February and March are some of the best months to sign up for credit card offers because people spend less after the holidays are over, and credit card companies are still trying to maintain a constant influx of new credit card customers.
It is always a great idea to keep a note pad or even screenshots of the previous credit card offers for companies you are interested in now and in the future. This will allow you to look back on what their previous offers were and compare them to what they are now.
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Consider a Cash Back Credit Card
I LOVE my cash back credit card!!! They allow me to make a part-time income from just the cash back alone.
Cash back credit cards will generally have other offers you can activate in order to get more cash back from shopping at certain stores. So it is good to check your account every month, even if you have autopay setup, just so you can remember to activate these offers because they don’t activate automatically.
Depending on the credit card company, you might be able to deposit the cash directly into your bank account. However, most of the companies try to make you redeem your cash back as a statement balance.
Pro tip: Sometimes, you might see on you online account that you can get a check for your cash back sent to you, but you won’t see an option on the online portal to request a check. That is because you have to call the company and request it instead.
Pro-Pro tip: get your cash back direct deposited into your bank account or sent to you as a check if you can. Many banks offer mobile check deposit or ATM check deposit. Then you can either put this money in a savings account or you can invest it in the method of your choice. You could also use this same money to pay for your statement balance. Just remember, if you are trying to apply the money towards your credit card statement balance and not just towards your overall balance, you have to follow this method. Just redeeming your cash back directly onto your credit card account will not lower the amount due for your statement balance.
Be Aware of Revolving Category Credit Cards
These cards, in my opinion, are some f the worst to have. They are terrible because they can have more exceptions to their cash back rules than a normal cash back card, and the categories don’t generally have a set date that they change over on. Another issue is that the date of the purchase could be in the window for that cash back category, but because it wasn’t posted or processed until after the cash back offer changed, it no longer counts towards the cash back category offer that was available before.
Be Aware of Cash “Rewards”
These cards are different from your normal cash back cards, this is because instead of cash values, the cards are based on a points system. The conversion rate of points to dollars can change at any time. It sucks when you get a card, then a few months later they change the points rate. With a cash back card, it is harder for them to just up and change the terms of the card, although it can still be done.
Keep Your Eye on Annual Fees
Sometimes it is worth it to get a card, even if it has annual fees, just because of the perks it offers.
For example, I signed up for an American Express Blue Cash Rewards Credit Card back before they had an annual fee. Once they decided to start charging an annual fee, I had to decide if I still wanted to keep the card.
I kept the card because it made me more money even with the annual fee than I would if I used one of my other cards or got a new card with no annual fee.
Sometimes you have to really do the math and make sure that it makes sense for you to keep a card given your changing lifestyle or the card’s changing benefits and fees.
It is always a good idea to evaluate your credit cards and other accounts annually, just so you are sure that they are serving you best.
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Keep In Mind What You Already Have
If you are looking to get a new credit card, you should generally get one that some of the same perks you like from your other credit cards, just in different categories.
For example, if you have a credit card that already offers you 3% back on gas purchases, it doesn’t make sense to get another card that offers you 3% back on gas, unless it also has some other cash back category that you don’t have yet, but can use.
I try to constantly beat the cash back offers on my current cards and/or get cash back in categories that I purchase frequently, but don’t have a cash back card for yet.
Consider Getting a Catch All Card
It is a great option to have a credit card that is a no-fuss card. This means that there aren’t any categories for you to keep up with and that you are getting cash back for every purchase you make regardless of what it is.
There are plenty of exceptions to the categories that just are covered with credit cards, once you learn what they are, you can use your catch all card instead of losing out on your cash back completely.
