When shopping around to find the right it is most important to choose the card that incorporates features, including benefits and incentives, that best match your needs. This can save you money on charges and interest fees. Following the five steps below should help you choose the right credit card for you.

1. Choose Card. How you will use it?

The first step in choosing the right credit card is to consider how you will use it.

  • If you expect to always pay your monthly bill in full and on time, and have no interest in features such as frequent flyer miles or redeemable cash points your best choice might be a card which carries no annual fee and offers a long grace period.
  • If you sometimes carry over a balance from month to month, you may be more interested in a card that carries a (stated as an annual percentage rate, or APR).
  • If you expect to use your card to get cash advances, then you need a card with a low APR and which charges lower fees on cash advances. Remember that some cards will charge a higher APR on cash advances than for purchases.

If you do carry over a part of your balance from month to month, even a fairly small difference in APR can make a big difference in your credit costs over the period of a year.

2. Choose Card with longer Grace period and less credit card fees

When looking for the right credit card you need to check the grace period and the level of fees charged.

If you carried over a part of your balance from the preceding month, you may not have a grace period for new purchases. This means you could be charged interest as soon as you make a purchase in addition to interest being charged on the unpaid balance. Check the credit card application for information about the “method of computing the balance for purchases” to see if new purchases have their own grace period or if there is no further grace period once a balance is carried forward.

Most credit cards charge fees such as: annual fee, cash advance fee, balance-transfer fee, late-payment fee, over-the-credit-limit fee, credit-limit-increase fee, set-up fee, return-item fee and other fees. Make sure you are aware of these charges and factor them in when choosing your card.

3. Cash advance features

Some credit cards allow you to borrow cash in addition to making purchases on credit. The majority treat these cash advances and credit purchases differently. If you plan to use your card for cash advances check the information access to cash, APR, fees, limits on amounts and how payments you make are credited to your account.

4. Incentives and other features

Check to see what incentives and other benefits a card carries before deciding if it is right for you.

Many credit card companies offer single or some combination of incentives and benefits, including rebates, frequent flier miles or phone-call minutes, car rental insurance, travel or accident insurance, travel-related discounts, and credit card registration. With this a single call is all that’s needed to report all your credit cards are missing in the event your purse or wallet is lost or stolen.

Some credit cards offer insurance cover to meet the payments on your credit card balance if you become unemployed, suffer disability or die. This cover does come at a price. You can also insure against the $50 dollar liability that applies if your card is lost or stolen.

Before you sign up to pay for insurance features, think carefully about whether it will be useful to you. Don’t pay for something you don’t want or need.

5. What is the kind of the credit?

There are three basic credit card types and you should pick the one that best fits your present needs.

  • , which require a security deposit. The larger the security deposit, the higher the credit limit that will apply. Secured cards are usually offered to people who have limited credit records, people who have no credit history or those who have had problems with credit in the past.
  • , Do not require a security deposit and have just a few features. Most regular cards have higher credit limits than secured cards but lower credit limits than premium cards.
  • Gold, Platinum, Titanium, plus, etc. all offer higher credit limits and usually have extra features, such as product warranties, travel insurance or emergency service facilities.