Tips for Picking out a Credit Card

When you are picking out a credit card there are a few things you should look for before committing to using the card. With the new legislation that went into effect in 2010, cards are restricted on the fees they can charge. However, they have come up with many new usury charges that may impact your wallet.

The first thing you must consider is the interest rate that the card uses. The higher the interest rate, the more money you will owe and the quicker your maximum limit will be reached. Interest rates span a large range and should be looked at carefully. Many times the companies will charge higher rates if any payments were made late or if you exceed your limit at any time.

Check your payment cycle. A new trick the credit card companies have been pulling is dropping the billing cycle to 21 days. It has been common practice for the companies to have a 28 day cycle. By changing the cycle to 21 they can create an opportunity to have late payments. The card company will raise interest rates and add on late payment fees.

Finally, when you check through the small print check for fees associated with limit increases. Some credit card companies are now charging a fee to raise your credit limit. This is another add on fee they have began to use. Read the small print carefully, you will be amazed at what you find.

Taking the time to research your credit card before you use it will help you make sound financial decisions.