- Compare the credit card interest rates. Look for a low interest rate card but remember the interest rate is not fixed so it can be adjusted either quarterly or by written notice by the bank or company. You may be able to negotiate with your bank for a lower interest rate.
- Compare how finance charges are calculated to help determine the total cost of credit.
- Look at all charges for each card. Some companies add other fees, such as late-payment fees if your payment arrives after the due date, or transaction fees every time you use the card. Grace periods vary as well. Companies generally start the grace period at the time the purchase is posted to your account. However with some cards, the grace period can start on the day of purchase.
- Decide what credit limit is appropriate for you. Determine the amount of money you can charge each month based on your income.
- The credit card you choose should be widely accepted to accommodate the majority of purchases you make. Fewer credit cards will make it is easier to keep track of your credit spending.
- Compare services and features, such as travel insurance, rebates, purchase protection plans, cash-back incentives or extended warranties. Evaluate these features in terms of the extra credit costs to you.
- Make sure the annual fees are reasonable. Not all credit cards require an annual fee. It is worth shopping around to get the lowest fee or no-fee, especially if you pay off your balance each month.
Read each contract carefully before you sign so that you understand all the costs and conditions. Shop for a credit card the same way you would shop for any good or service. Try to negotiate for the options and conditions you want at the lowest cost available.
source: http://www.in.gov/dfi/education/choosecd.htm
