Freshman's Guide to the Best Credit Card Deal

A Credit Article Contributed by Tushar Goel

Have You Planned before Choosing a Credit Card Deal?

Do credit card deals makes sense to students? Yes, being a student has always meant lack of resources and money and credit cards have always come as breathers. It is very important, being a student, that we plan and manage our spending very carefully. As so the rule goes with the credit cards too. If we are trying to zero-in upon any credit card, we should take into some very important points about the credit card.

We should choose a credit card that gives us maximum benefits and is not very hard on our wallets which are already facing a cash crunch. There are many conditions that makes a deal worthwhile and a nice experience but if we do not plan accordingly and do not closely understand the rules and regulations that are tagged with a credit card deal, it may well prove to be an additional headache on already burdened self for ours.

Points to Look out for in a Credit Card Deal.

We should have a very fair idea about the deal that we are opting for. Some most important things to look for in a credit card are its Annual Percentage Rate; we should have the exact knowledge of all the basic and late fees that are levied on the credit card. We should also have more than a simple idea about what other advance fees are applied on the card. Other than the fees, we should know about the penalties and the amount that these penalties invite. Also, we should know what is the grace period limit after which the interest in levied on the purchase made on the card.

Rates of Interest in the Credit Card Deal.

Called as Annual Percentage Rate or APR, it is the rate of interest in the percentage that is applied on the amount that is spent on the credit card. There are generally two broad categories of type of interest rate charged in credit cards. They are one, Fixed type of the rate and second, variable type of the rate. In the former type the rate at which the interest is charged on the principal amount of purchase or spend never changes.

For example if the rate is fixed at 12% by the company, you would always be charged 12 or more percent as interest. In case the company decides to change the the rate to a higher percentage, you will be notified 15 day in advance as required by the federal law. The most popular form of interest is variable type in which the rate is dependant on a market based index, for example Wall Street Journal index, based on which the interest rates fluctuate.

But what is important and should be monitored by the students is if the rate decreases according to the market index or is it just when the index goes up does the credit card rate comes into action.

Fees and Penalties and Grace Period.

We should have good idea about all the fees and any penalties that the credit card invite. A good credit card deal is the one that comes with no fees and lesser complicated penalty structures. The most important fees is the annual fees which should not be there. Other important fees to look out for are cash advance fees and service fees. Then there are penalties on late payment, over limit purchase. Being a student we must know about them and most importantly avoid them. Then the most important thing is grace period. We should not opt for a credit card that does not have a grace period.