A Honest Look at Getting a Credit Card | personal finance application

You may be thinking of getting a credit card, upgrading your existing card, or your bank may have sent you a letter regarding your eligibility for credit. However you came to the decision, you?ve decided that it?s time to get a new (Or your first.) credit card. There?s a lot to think about, and many questions to be asked in order to make a wise choice, and to make your life easier, not to cause more stress on your life and finances.

In the following paragraphs, I hope to help you to be able to make the wisest choice in find the right offer for you, and make your life that little bit easier!

Wise Choices Help To Make Debt Easier To Manage
Debt is a scary thing that can spiral out of control unless you make wise decisions from the get go. Knowing a few things about your spending habits, budget, and your incoming and out going finances is a perfect start to know what you can afford to pay in regards to interest rates and what a smart credit limit would be. Getting in over your head will cause problems in the long run. A high credit limit may sound nice, but do you really want to have the hassle of a giant bill that you never seem to be able to pay back?

Look At Your Financial Situation And Be Honest With Yourself.
Before you decide, look at your finances. Do you have more money coming in than going out? Do you have a saving account with a nice sum of money gaining interest? Knowing you have money aside to make repayments without hassles or being overwhelmed. If you are spending equal or more than what you have coming in, then a credit card will only enlarge your financial woes and put more stress on your life, which isn?t what you want at all.

Interest Rates
When you see the offers available, look at the interest rates offered. Some interests rates may be low for the first six months or year, and then jump up dramatically following this period. The debt that was left on your card from the initial period will now be processed on the higher interest rate, which can cause a great pain in your wallet and bank account.

Credit Limits
Deciding on a limit is also very important; as they can decide how much money you are capable of ending up owing. Most financial institutes and banks will only offer a small limit to new customers. But in addition to the limit, you must also be concerned about the interest rate, as some banks have low interest cards, e.g. ANZ Low Interest Credit Card. Over time, if you show a responsible attitude with making repayments, you may be offered a higher limit. Some times, the higher limit is not a good thing. Just because you can afford a $1000 limit doesn?t mean you can have the same ability with a $2000 or a $5000 limit. Some cards give you a lot of time to repay, e.g., Westpac 55 Day Credit Card.

Paying Back The Card
Using plastic money, you may feel as if you?re not even spending your own money at all, but you definitely are using someone?s money. And that means you have to be wise on your choices. When the bill comes in each month, will you just be paying back the interest and the debt incurred, or will you just be paying back the interest, and not the main slice of money owed?

About the Author

Want to learn more about the best credit card offers? Visit ANZ Low Interest Credit Card and Westpac 55 Day Credit Card on CreditCardOffers.com.au

Source: http://www.taraash.net/2012/06/30/A-Honest-Look-at-Getting-a-Credit-Card/

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