October 17, 2008

Credit Cards!

So, in this time of financial turmoil...I'm trying to pick a credit card.

Does anyone have suggestions? What credit card do you have? What would you suggest looking for - or avoiding? What about credit cards that get you frequent-flyer miles or help save the universe?

I'd appreciate any advice! Thanks, Quench!


bat dor said...

Get a Visa, because it's accepted everywhere. Lots of restaurants in the USA don't accept American Express and Discover, and if you go overseas you'll have even more trouble using them. (I have no experience with Mastercard.)

Make sure your card charges no annual fees. You shouldn't have to pay for the privilege of carrying around a hunk of plastic.

If you fly a lot, then perhaps an rewards card that gives you mileage is worth getting. But in general, I don't see rewards cards as having much added value.

Lots of different websites will tell you what interest rates are considered "good". Here's my two cents: If you're using a credit card properly, the interest rate doesn't matter.

Here's what I mean by properly: Pay off the balance every month. I'm going to say that again. Pay it off Every. Single. Month.

That way,
(1) you never pay any interest on your purchases,
(2) you're establishing excellent credit, and
(3) you're forcing yourself not to succumb to the mistaken belief that when you use a credit card, you're spending someone else's money.

Point (3) is the most important, I think. Paying with a credit card should hurt just as much as paying with a debit card, or paying with cold hard cash. If it doesn't, you'll inevitably end up spending more, and if you look around at the economy right now, you'll see where that road leads.

Good luck!

spork said...

+1 on everything bat_dor said. The Chase Amazon.com Visa is a good starter card - low limits and good rewards. :) I have the Chase Freedom card now (that I'm not a student anymore), and I love it too.

Ily said...

Thirding bat_dor. If your card doesn't have a fee, and you pay it off every month, there's not all that much difference between them. The credit card companies will try to do things to make you slip up and owe them money, like by sending you checks and stuff (which you should not use). Just don't fall for it ;-)
I have a Capital One Visa, which has been fine so far. I have no idea why I got it in the first place, though.