Which Credit Card Should I Get?
While this question is relative, it’s an important one to ask. We, as consumers, have a variety of options when it comes to choosing the best credit card for our needs. And that’s the question we need to ask ourselves first: what do we need a credit card for? This varies based on each individual.
Are you looking for..
.. a credit card best for a student?
.. cash back rewards?
.. a no annual fee card?
.. a travel credit card?
.. a card that accepts a low credit score?
.. a card to begin building credit?
Before I continue, let me be clear: I am not a licensed financial advisor. All financial and/or investment advice is based on my personal experience and curated for your educational and informational purposes. When making investment and financial decisions, you should do your own research.
Prior to making any sorts of decisions or starting your research online, evaluate what your credit score is and what exactly you’re looking for. You can check your credit score for free at: creditkarma.com. Because this is a “soft” credit pull, it doesn’t negatively impact your credit score if you were to check it multiple times. However, credit scores don’t vary a whole lot on a day to day or weekly basis so checking it once every couple of months is probably ideal. Note: “Hard” credit pulls are when a bank or lender pulls your credit score. This can negatively impact your credit score but it’s typically not more than a few points.
Once you’ve figured out what your score is, you’ll now need to evaluate your needs. The best way for me to explain this is through my own situations. As a new high school graduate, about to start college, I was looking for a credit card to start building my credit and one that allows for student benefits. I applied for a Discover Student Credit Card that allowed me to earn cash back through my purchases as well as get benefits when I spend on school related items. This is a $0 annual fee card which was a great way to begin building credit as a student.
As the 4 years went on, I was able to consistently pay back my full statement each month maintaining my credit score. Upon graduating college, it was time for me to seek out another credit card with greater benefits. I was a huge fan of no annual fees when it comes to cards and valued cash back more than anything. Those being my biggest criteria, I applied for the Citi Double Cash Card giving me 2% cash back on all purchases. I still use this card for everyday expenses and love it!
The second card I applied for was my most recent one. I knew this upcoming year has a lot of travel in store for me and what better way to earn points for it. I ended up applying to one of my favorite credit cards, the Chase Sapphire Preferred. While this credit card does have an annual fee of $95, I was able to earn 5x that just by signing up and receiving the 60,000 bonus points. I utilize this card on every flight, hotel, and travel I book. It’s been a fantastic way to earn points just by spending on things I’d normally do anyway. I can’t wait to save up enough points to sponsor a birthday vacation trip this year!
Now that I’ve built up some credit and had my fair share of experiences with credit cards, the next card I’m evaluating gets me all sorts of perks such as hotel credit, free lounge access, shopping credit, premium rental car access, and so much more. These include the American Express Platinum Card and the Chase Sapphire Reserve. The downside of these cards are the high annual fee of about $550+. This is exactly why I encourage you to evaluate your scenario and what you’re looking for in a card. A $550 annual fee card would NOT make sense for me as a student. However, as a working adult that travels constantly, it might just be the best option out there.
As you’re researching, feel free to reach out and here are some additional resources you can check out.
Nerd Wallet: Great website for an impartial review on credit cards filtered by credit score, reward type and more.
Bank Rate: Another awesome website to compare different cards and find the best suited one for you.
Good Luck with your search and feel free to reach out with any questions as usual!