Choosing a New Credit Card

Now that I have no debt I am comfortable enough to get a second credit card. Not so I can max out two- but so I can stop using my other one and to build up some more credit and reap some sweet rewards.

When choosing a credit card, you first need to determine how much you are going to use it and for what. This will help you narrow down what type of card you should be choosing. For example, if you only plan to use it for emergencies, a cash back card won’t be your first choice, but a low interest rate card could be. Along with no annual fee. This is a personal choice, so I won’t go too much into it.

Along with that personal choice comes another one: what do you want out of the card? Flying miles? Cash back? Discounts? Other types of rewards? Along with this, you will decide how much you want to pay annually for this card. The higher the fee the better or more interesting the rewards usually.

There are lots of websites and blogs that have reviews and recommendations on the latest and best cards available. Take a look around and take into account what others are saying.

The MOST important aspect of having a credit card is to PAY IT OFF ! DO NOT carry a balance. If you can’t commit to this simple rule or cannot afford to do so, DO NOT get a credit card until you get a hold on your spending habits and your finances.

As for me, I;m currently debating between these two cards:

Amex Cashback: http://www.greedyrates.ca/blog/simplyacash-americanexpress-cashback/#.VVzLALlVhHw

BMO Cashback: http://www.greedyrates.ca/blog/bmo-cashback-world-elite-mastercard/#.VV4F5LlVhHw

The BMO has higher cashback percentage, but a) I’m over BMO, and b) it does have an annual fee of $120 after the first year which will not make it worth my while.

So I guess I just decided which card I will be getting. I want to use my CC for all my purchases, and pay it off before the due date, that way I can have my salary sit in my savings and accumulate some interest… And also for the cash back and rewards.

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5 thoughts on “Choosing a New Credit Card

  1. Hopefully you’ll have a better experience than me. I paid off a credit card each month for years, but then got bit when I mis-wrote a check. The credit card company didn’t say anything for a month, then charged me for two months worth of interest on the original purchases and interest on my new purchases. All of my rewards were quickly wiped-out. I’ve come to learn that debit is just better. Cash is even better than that since it hurts a lot more to whip out $6 in cash to buy a latte than it does to whip out the plastic. At least it might stop you from adding a $5 piece of pie.

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    1. So true ! Cash is much harder to dish out. I’m pretty good with paying off the cc- thanks to direct payment I pay it off every couple weeks so it doesn’t accumulate too much. I haven’t been using credit lately but now that I am starting to this is my plan going forward. That really sucks though, credit card companies are always out to get you – even if it’s an honest mistake !

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  2. The cash back credit cards are a great way to earn money just for spending on stuff you would normally buy. But like you said, it is incredibly important to pay your card off each month or you will lose all the benefit. I am totally with you on getting a no-fee card. My only concern with AMEX would be it’s not always accepted everywhere.

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    1. Thanks for the comment Jess! I do find myself always asking “do you take Amex” and surprisingly a lot of the time the answer is yes. There’s only been a few places, I can only think of Baskin Robbins right now, that didn’t take it. For those places I usually just use debit or my MC.

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