With the U.S. News guide to credit cards, you can find out how to choose the best credit card for your needs. You should consider factors including your credit score, existing card balances, and whether you want to earn rewards or pay an annual fee.
The Right Credit Card for Your Credit History
If you have good credit (a FICO score of 670 or higher), you should be able to qualify for credit cards with the best terms. People with fair to poor credit (669 or lower) may only qualify for credit cards designed for bad credit.
Credit cards for good to excellent credit typically offer rewards and the most attractive terms. They usually have lower APRs, higher credit limits and offer cardholder benefits.
People with bad credit may not be able to qualify for the cards with the best terms. Credit cards for people with bad credit may require an initial deposit, have a lower credit limit, or have a higher APR and additional monthly fees.
Using Credit Cards to Pay Off an Existing Balance
If you have credit card balances, you can move your debt to a balance transfer credit card with a zero percent APR introductory period. This will allow you to pay down the balance interest free during the promotional period.
How to Make the Most of Credit Card Rewards
Credit cards with rewards offer points, cash back or miles for every dollar you spend on your credit card. You can redeem your rewards for cash back, travel, merchandise and more. Some cards offer bonus categories, which allow you to earn rewards at a higher rate. Rewards cards often have a sign-up bonus, which allows you to earn bonus points, miles or cash back with your first purchase, or if you spend a certain amount of money on the card within a promotional period.
When Paying an Annual Fee is Worth it
Some credit cards come with an annual fee, usually between $25 to $500. Often, this fee is waived for the first year. If you have a card that offers excellent rewards or benefits, it may be a good idea to keep the card and pay the annual fee. A card with a good rewards program may allow you to earn more in rewards than you pay for the annual fee, or benefits such as free checked bags or companion flights that can be worth more than the annual fee.
Using Cardholder Benefits
Often, credit cards have benefits for cardholders. These include free FICO credit scores, auto rental insurance, extended warranty coverage, roadside assistance, purchase protection and trip cancellation insurance. Travel credit cards, especially airline cards, typically offer the best cardholder benefits, such as priority boarding, free baggage, airport lounge access and free companion flights.
Types of Credit Cards Available
With hundreds of credit cards available, it’s important to take the time to find the credit card that is right for you. U.S. News offers guides to the best credit cards available for different needs, including:
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Travel credit cards: Credit cards that offer rewards for travel, and often have cardholder benefits for travel, such as free checked bags and priority boarding.
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Rewards credit cards: Credit cards that earn rewards for every dollar spent on the card, including cash back, points or miles.
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Bad credit cards: Credit cards designed for people with bad credit. These cards are easier to qualify for, but they may have drawbacks including security deposits, lower credit limits, higher APRs and additional fees.
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Student credit cards: Credit cards designed for college students with little to no established credit. These cards may have features designed for college students building credit history, such as free FICO credit score access and rewards for good grades.
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Balance transfer credit cards: Credit cards that offer zero percent introductory APRs on balance transfers. With these cards, you can pay down your credit card balances with zero interest during the introductory period, usually between 12 to 24 months.
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Business credit cards: Credit cards offered to business owners. With business credit cards, you can separate business and personal expenses and may be able to take advantage of business rewards and cardholder benefits.
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Cash back credit cards: A type of rewards card, cash back credit cards earn a percentage of what you spend on the card as a cash back reward.
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Low interest credit cards: Credit cards that offer zero percent promotional APRs, or low standard APRs. You can use these credit cards to save on interest.
To learn more about credit cards and the top credit cards available today, visit the U.S. News guide to credit cards.
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