How to choose a credit card

With so much information online these days – almost too much – it’s difficult to separate the wheat from the chaff when it comes to looking for the best credit card. What’s important to keep in mind, however, is that no one card will be the best for everyone. Before signing for one, you need to do your research, ask the right questions and figure out which is perfect for you, based on your income, spending habits and credit history. Need a couple of pointers on where to start? Here we go.


Before you can even consider getting a credit card, you need to understand what you qualify for based on your credit score and income. The higher your credit score, the greater your chances of securing a card with great perks.

There are a couple of ways to check your credit score (keep in mind that you’re entitled to one free credit report a year, so choose the timing wisely). If your credit score isn’t as good as you had hoped, then you need to identify why. If there is an error, you need to dispute it. But, even if everything looks like it’s in order, it might be a good idea to find ways to improve your credit score before you apply for a card that might land you in the darker side of red.


Once you are satisfied with your credit score, it’s time to figure out exactly why you want a credit card. There are typically three different types of cards, and you need to choose that which suits your situation as well as your needs the best. A card that earns you loads of flyer miles doesn’t serve you if you’re not interested in getting into an airbus anytime soon.

The first type of credit card is the one that is best suited to helping you improve your credit score. The second can save you some money on low fees or interest, and the third can earn you rewards each time you buy or swipe.

Credit cards that can help you improve your credit score are normally intended for students (unsecured cards) or who have low initiation fees and don’t require a high monthly salary as a qualification criterion. The trick with these cards is to use them only for low amounts and to ensure that you settle the balance at the end of every month. Using them too much and not being able to keep up with the payments will land you in even more trouble, and result in an ever-lower credit score.

Cards that help you to save by offering low fees or good interest rates are a good idea if you are looking for a lifesaver in case of an emergency. Look for a card that naturally has a low-interest rate, but at the same time one with a low initiation fee and low minimum monthly payments from the get-go. This will help ensure that you don't pay for features that you don't need.

If you are interested in cards that give great rewards, it’s important to understand that these are the best option only if you are the type of person to settle your balance every month, thereby reducing the amount of interest you incur. Theses bonuses and rewards include everything from flyer miles to cashback based on how much you spend each month, but know that these perks will cost you.

  • How much will it actually cost me? Understand the monthly implications as well as the initial costs and annual fees.
  • Can you qualify for a better card later down the line? With your first credit card, you might qualify for only an entry-level card or one with an incredibly low credit limit. But, as your credit score improves and your salary grows, it’s a good idea to determine the possibility of a better option when the time comes.
  • How long do you have to pay off your credit card before the interest starts catching up with you? Ideally, you would want a card that gives you adequate time to pay off your debt interest-free; however, if that’s not possible, see what the next best option would be.
  • Is there a card that gives you more bang for your buck in points when you shop or spend in shops and areas or on categories that you love? Because, if this is your main focus, you would want to make the most of the rewards system. If you also want to use your card for travel, then look for one with the lowest international transaction and withdrawal fees.

Ultimately, the credit card you choose should get you one step closer to achieving your financial goals.

So, whether you want to build a good credit score, have credit available for emergencies or earn rewards (or a little bit of all three), it’s important to find a card that can help you to do just that. Once you have your card, try your best to keep your limit high, your spend low and your credit paid off every month.


For more useful money-related tips, sign up for our Money Mailer. In this free monthly newsletter, we serve up articles on topics ranging from saving to borrowing and everything inbetween. If you've ever wanted to know how to save for a new car, how to reduce your electricity bill, or how to improve your credit score, the insights in these articles can leave you wiser, wealthier, and better equipped to make the most of your money.