by Bob Jones

Almost everyone over the age of consent has or wants a credit card these days and they are accepted in almost every establishment. There are three major kinds of credit card common in America. The first major kind of credit card is travel and entertainment cards such as American Express or Diners Card. These have to be repaid completely at the end of the month and are generous on spending limits.

The second major type of credit card is the bank card such as Visa, Master Cards, GM, and Ford cards distributed mainly by the banks. The bank defines the spending limit, which in bank speak, is known as the credit line and each bank offers different terms and conditions. Banks offer a selection of payment means: you can either repay the balance in full with no interest charges or pay the minimum (or some part of the balance) with an interest.

The other major kind of card is the retail store card, such as Sears, J.C. Penney, Shell or Mobil. These store cards and those from gas companies, widely known as fuel cards, are only taken in specific countries. They usually do not carry annual fees. There is a large variance in the terms and conditions for these cards.

Different sorts of credit cards offer different options. Some are geared toward individual consumers, while others are designed in ways that work best for small business needs. To know what sort of credit card fits your needs, you should look over a few options.

How to Select a Credit Card.

Credit cards have become a part of everyday life for most people who live in the west. It’s becoming increasingly impossible to avoid them, especially for business men. So, if this is the first time you are thinking of entering into the world of plastic money, here are some of the basic things you should look out for.

First, compare the interest charged on all the credit cards you are interested in. While the rate may not stay fixed indefinitely, it’s always best for novices to apply for the one charging the lowest interest rates.

Make sure you study the small print carefully, especially on the other charges that may be applied, like late-payment fees, annual fees, and whether there is a grace period, which is normally given before the finance charges are applied.

Decide what spending limit is most appropriate for a person of your income. Also the fewer credit cards you have, the better placed you are to understand your spending.

You should compare the services and other features such as the cash back incentives, or warranties, rebates and the like and check whether the card is taken widely enough to suit your needs.

You should acquaint yourself with the following terms: 1] Annual Percentage Rate: this is the yearly cost of the credit. 2] Finance Charges: these are the total charges involving the transaction. 3] Period of Grace: This is the period of time the card issuer allows you before they begin charging you interest on your purchases. (Not all credit card issuers allow a grace period).

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