An easy and detailed classification of Credit Cards for making your Credit Card choices easier.
We have all been there, and thus we know.
Choosing the Credit Card that suits you the best is like finding the perfect pair of running shoes. Gone are those days when we had to collect brochures from various companies to identify the Credit Card we should get. A few clicks and you have a detailed understanding of which Credit Card should be your buddy.
Here, at Omnicents we help you make better decisions. That and only that is our ultimate agenda.
That is why we researched and researched and came up with the findings we are listing below to help you choose the perfect Credit Card for yourself.
There are many ways under which you can classify Credit Cards.
However, we have listed it in the simplest and most compatible form possible.
The best way to classify Credit Cards is under 3 groups.
First, Credit Cards that help you earn rewards.
Second, Credit Cards that help you build your Credit score.
And finally, Credit Cards that help you save up on the interest.
With this categorization in place, let us now look into the benefits and possible drawbacks of these 3 types of cards one by one.
1. Credit Cards that help you earn Rewards
Yes, you have guessed it correctly, these Credit Cards are also often referred to as Payback Credit Cards. These types of Credit Card pay you back a little something every time you spend something. And who doesn’t like paybacks, right?
For instance, if you spend $1000, Payback Credit Cards return you around 1% to 10% of your spending. The payback percentage varies as per different companies.
Some of these Credit Cards even give you reward points based on your spending in some selected stores. And you can either encash or use these reward points for your future shopping.
There are Credit Cards that reward you based on your Air Travel record. The more miles you cover, the more reward points you get.
But hey, nothing good ever comes without a little catch. These types of Credit Card usually have a higher rate of interest. And more than often, these kinds of Credit Cards require a very good Credit Score.
In case you carry forward your Credit Card bill amount to the next months, the charges will definitely not be very pocket friendly.
2. Credit Cards that help you build your Credit Score
These are the easiest available Credit Cards in the market. Why?
Because usually the Credit Card company issues these Credit Cards against a fixed amount of Security Deposit. The Security Deposit amount is approximately nearby your Credit Limit. That way, there is a low risk in case of failed payments of your Credit Card bills, and that is why they are very easily available.
You can very easily get this kind of Credit Card and use it responsibly. You pay the bills on time and help yourself climb out of the bad credit range. And once your credit score is good, you can get yourself a Fair score Credit Card (which possibly wouldn’t ask for a security deposit from you).
These Credit Cards are very student-friendly and also very good for Credit Card noobs who want to increase their Credit Score.
You can also apply for Student Credit Cards if you are a student.
3. Credit Cards that help you save up on the Interest
Life always isn’t a bed of roses. Some of us might have absolutely no issues to clear out our bills as soon as we get them. But that’s just some of us.
Most of us, usually have problems to clear our bills in full every month. And this type of Credit Cards is the best option for us.
There will be no debt amount if you pay your bill in full for each month. But in case you roll up your payment to the next months, the Credit Card company levies a certain amount of debt on you. But Credit Cards with 0% carryover interest rate exists.
There are Credit Cards which levy very low interests and often even no interest at all.
There are even many Balance Transfer Cards available in the market which let you transfer your billing balance to a low-interest Credit Card from a comparatively higher interest one, at very little or 0% interest.
However, you must have a good to excellent credit score to get your hands on these types of Credit Cards.
Choose wisely and try to never be in the Bad Credit Score area. And even if you ever get there, come to us, we will pull you up. That’s a promise!
Be wise and choose correctly.