5 Strategies to Score the Best Credit Card

January 8, 2013
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A New Year might mean a new credit card for some consumers. So don’t just sign-up for any credit card you happen to stumble upon – put some strategy behind this process. We’ve done the work for you, so just read:

1. Don’t Pay Attention to the Fancy Offers

Credit card companies typically send out offers to consumers telling them they’ve been “pre-approved,” for a credit card. This means nothing and doesn’t guarantee you’ll actually be approved for the card. Also, we’ll see issuers bribe consumers with 15,000 free rewards points if they sign-up. But many times you need to spend at least $1,000 within three months to get these bonus points, which could prompt you to spend money you don’t have and get into debt. Instead, do your own research online – head to the credit card company’s website and shop around at sites like Credit.com, which will compare cards.

2. Look for Unique Perks

Aside from the rewards points and annual fees, some credit card issuers are rolling out some innovative perks. For example, Citi card members now have access to Citi’s Price Rewind program, which will scan thousands of retailers for 30 days after making a purchase – and if the item drops by more than $25, you’re eligible for a refund of the difference. Also, Discover launched a new card in 2013 (the “it” card) which lets users choose their monthly due dates and even setup email reminders prior to the deadline.

3. Tailor Rewards Points to Your Lifestyle

When considering a new credit card, look closely at what the card’s rewards program offers. A credit card that offers 5% cash back on gasoline purchases won’t help someone who lives in the city and doesn’t own a car. On the flip side, 5% cash back at restaurants is great for those who may not cook and are constantly ordering takeout on Seamless. In fact, some credit cards will even offer 3-5% cash back on gym memberships, which will be helpful as January is a time when consumers head to the gym to tackle their New Year’s resolutions. The point is, find a credit card with a rewards points program that suits your lifestyle and spending habits.

4. No Annual Fee, Period.

There are plenty of credit cards with no annual fees – so there’s no reason to pay an annual fee, which can range from $79 to $495. And the cards with no annual fee even have robust rewards programs. The only reason why you might get a card with an annual fee is because these cards typically include free access to airport lounges, which is a plus for frequent travelers. But there’s no reason to pay a fee every year just to have a credit card, it makes no sense!

5. Spread Out Your Credit Card Applications

Let’s say you want to open up two new credit cards this year. Don’t apply for them at the same time. Spread them out, at least six months apart. Opening up multiple credit cards within a short period of time will hurt your FICO score, as it shows creditors that you’re hungry for credit – and the more access to credit you have, the more at risk you are of getting into debt.

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Tags: Business, Citigroup, credit card, Discover Card, Home, Loyalty program, money management, personal finance

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