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How to find your perfect credit card

A woman holding a credit card

In a world flooded with credit card offers and endless options, how do you find the right credit card? We’ve got an easy framework to help you decide which one is right for you. 

1. What’s the point?

One of the best places to start when looking for a new credit card is by thinking about why you need a credit card in the first place. After all, your goals will inform the features of your preferred plan.

Do you have any specific goals? Are you looking to establish or improve your credit? If so, a secured card may be what you’re looking for. If you want to earn points, miles, or cash back for your everyday spending, you’ll probably want a rewards card. If you are consolidating from other cards or Buy Now Pay Later plans, your best bet is likely a low-interest, no-rewards card. 

For an explanation of the different card types, see “Card Types” below. 

2. How will you pay?

How you repay your credit can also impact the type of card that is best for you. For instance, do you plan to pay your entire bill each month? If so, the interest rate probably won’t matter as much to you, and you will want to focus on the fees you may have to pay for using your card, like annual fees, foreign transaction fees, or cash-advance fees. 

If you think you’re only going to pay part of your bill each month and pay down your balance over time, the interest rate will be very important to you. The higher the rate, the longer it will take you to pay off your balance. To see how interest rate affects your repayment period, check out our credit card calculators

3. What will you be buying?

The kind of purchases you expect to make with your card will point you to the best card for you. If you are using your card for travel, a card that rewards you with miles and special travel perks like baggage allowances would be a great choice. If you are charging everyday expenses like gas and groceries, a rewards card that gives you bonuses on those spending categories, like the First Tech Choice Rewards Mastercard® could be the right way to go. A card with a low introductory rate is a great choice if you are making a big purchase that you plan to pay off before the introductory period expires.

4. Where will you be buying?

Will you be purchasing online or in person? If you’re doing mostly online shopping, you may want to look for a card with strong online protections, like Mastercard Click to Pay, zero-fraud liability, and purchase assurance. If you’ll use your card in-store often, look for a card that works with major digital wallets to safeguard your card information.  

If there are companies you like to shop with, look for merchant-specific card offers from your card provider. That’s a good way to maximize your rewards earnings.

5. Considering the cost of credit

The convenience that credit offers also comes at a cost. However, by understanding the expenses that credit cards entail, you can leverage the advantages of your plan.

Interest Rate

The interest rate is the amount the card issuer charges you to borrow money, expressed as a percentage. Credit card interest rates are variable, meaning they can change over time and are determined partly by your credit score. Rewards cards typically have higher rates than non-rewards cards. Most cards have a grace period where you aren’t charged interest if you pay the full amount before the grace period expires. Usually, that’s the due date on your next statement. Be sure to read the terms and conditions for your card to make sure you know how long you have to pay back your purchases before you have to pay interest. 

Fees

Credit cards also typically charge fees such as annual fees or cash-advance fees. Always note these fees before you sign up for a credit card. Again, rewards cards typically have higher fees than non-rewards cards, but there are many cards you can choose that don’t have annual fees.

6. Card types

There are a number of card types out there, each with different features.

Rewards cards let you accrue points when you make purchases on the card, which you can redeem for cash, travel, merchandise, and more. Rewards are typically expressed in terms of how many rewards points you earn per dollar spent, e.g., 2x rewards = 2 points earned for every $1 spent. In addition to points, some cards will give you special benefits, such as access to a concierge service, ticket and event discounts, or perks like baggage allowances. See below for some of the available perks and rewards.

Premium cards are rewards cards that offer enhanced rewards potential, usually with elevated annual fees and/or interest rates. These cards often come with elite perks and special offers not available to other cardholders. Even with higher fees, premium cards can be a great value, assuming you use them wisely.

Secured cards are cards whose credit limit is tied to funds deposited into an account with the card issuer. The deposit can be equal to the credit limit or just a percentage of the limit, depending on the card issuer. In the event the borrower doesn’t pay their bill, the card issuer will typically pay the card from the funds on deposit and close the card. Secured cards can be a great way to build and improve credit and may or may not offer rewards, but interest rates can vary, so it’s important to make sure you’re getting the best deal.

Non-rewards cards are just what they sound like. These cards typically have lower rates and/or fees than rewards cards but don’t let you earn rewards points and often don’t have as many benefits. Non-rewards cards are great choices when you expect to pay back your balance over time, but be sure to compare rates, as there can be a wide spread among different issuers.

7. Picking your perks and rewards

There are a variety of credit rewards out there. Of course, not every card will feature each reward, but it's good to know your potential options as you search for that perfect card.

Buying incentives: Many credit cards offer an incentive to use the card right when you get it. For example, zero-interest first-years are a common feature of some cards.

Cash back: Many credit cards offer a cashback program that gives a portion of the money back for every qualifying purchase.

Gift cards & discounts: Some credit card companies offer exclusive deals to local businesses, shops, and restaurants.

Special access: Some credit cards even offer gated or early access to content like concerts or shows.

Travel benefits: Many cards offer travel “miles” for the amount of money you spend. If you’re a big traveler, look into a card that offers these benefits.

Online shopping purchase protection: Some cards offer protection and mercy periods for online purchases. This way, you can monitor your purchases and cancel any erroneous or inaccurate charges.

Choosing the right credit card can be a challenge, but understanding why, how, and where you’ll use it can make the process easier. If you need advice in choosing a card, give us a call or schedule an appointment with one of our financial experts.

Did you know that First Tech offers many different credit cards? Visit our credit cards page to make your own card comparison now.