Credit cards can do much more for you than spread the cost of a big purchase. You can use them to boost your credit score, offer cashback, or fund your next holiday with reward points. But not all cards are created equal. Choosing the right one means assessing how it aligns with how you spend, what you value, and where you want your finances to go. Read on for some practical advice on choosing the best card for your lifestyle so that you maximise the benefits while avoiding unnecessary costs and fees.
Know your spending patterns
Before applying for a credit card, scrutinise your typical spending. Do you use your card mainly for travel, for everyday shopping, or just for the occasional large purchase? A card might offer attractive rewards for supermarket spends – but that won’t help much if most of your money goes to flights and hotels, or if there isn’t a branch of the applicable supermarket in your area.
Choose rewards you’ll actually use
Air miles. Cashback. Store vouchers. There are so many credit card reward programs out there and they vary greatly. First, look beyond the tempting welcome offer and go for a program that will give you benefits that you will actually use. If you go on holiday just once every few years, for example, air miles won’t mean much to you.
Then, read the fine print to see whether the rewards are capped and at what level – some cards will offer great introductory bonuses but less value over time. Also check exactly how rewards are earned and whether you will use the card enough to reach the threshold for gaining the benefit.
Watch for interest rates and hidden fees
Before you commit, find out the real cost of using and holding a balance on your card – in particular, understand what Annual Percentage Rate (APR) means. Rewards aren’t worth it if you’re paying high interest. If you won’t be paying your balance in full each month, focus on a low APR card. Look out for annual fees, late payment charges, and overseas transaction fees.
Using a card to rebuild your credit score
If your credit score needs work, opt for credit cards designed to help rebuild it. Responsible use of credit cards will show lenders that you’re managing money well. Choose a provider that reports to major credit reference agencies and offers manageable credit limits with clear terms.
Security features and perks
Modern credit cards often include purchase protection and fraud alert texts. They also offer mobile apps for greater convenience. Some go further and offer extras like access to exclusive airport lounges or travel insurance. List and add up the financial benefit of each of these features when you’re comparing cards – they can add real value if they match how you already live and spend.
The best card is the one that fits
It will take a bit of research and reflection, but by following these tips, you can find a credit card that supports your goals, rewards your habits, and keeps your finances on track.
