What Is the Best Credit Card?

January 18, 2012 No Comments »
What Is the Best Credit Card?

The answer to this question is easy. Drum roll please…

The best credit card is…the one that provides you with the most benefits. That’s it. We’re done. See you later. You can stop reading this now.

Okay, I’m being dramatic, but honestly, there isn’t a single “best credit card” out there.

You see, like many other things in the world, the “best” of something is often subjective, meaning it depends on who’s asking and who it’s for.

For me, the best credit card is one that provides me with the most cash back. Why? Because I want cash back above all else. I don’t care about travel rewards or any other specialty rewards.

I also don’t need a 0% APR credit card because I pay my credit card balance in full each and every month. So the credit card APR has no bearing on my decision.

Additionally, I have an excellent credit score, so I can apply for whatever credit card I want.

Also, because I have good credit and don’t need a specialty card, I don’t need to pay an annual fee.

Lastly, because most of my credit card purchases take place at gas stations and supermarkets, the American Express Blue Cash Everyday card is my “best.”

You see what I’m getting at? I found a credit card that was tailored for my needs, with my best interests in mind.

I didn’t just Google “best credit card” and make my decision based on some top 10 list or what someone else said.

What Do You Need Most from Your Credit Card?

When deciding for yourself, first determine what you need most out of your credit card. Is it cash back, customer service, a low interest rate, a balance transfer credit card? What is it!

Once you’ve got that narrowed down, you can begin your credit card search.

The second step should be determining what credit card you’re actually eligible for. In other words, what is your credit score and is it high enough to successfully apply for the credit card you’ve got your eye on?

It is recommended that you check your credit scores before applying for a credit card to determine your chances (It won’t hurt your credit score).

After all, if your Fico score is sub-600 and the credit card in question calls for “good credit,” there’s not much reason to apply.

You’ll simply be adding a credit inquiry to your credit report, which will likely push your credit score even lower, at least short term.

So see where you stand, determine what you need, and keep narrowing it down.

Company Preference?

Some individuals may also have a company preference. For me, American Express has always been my go-to credit card issuer, largely because their customer service is unmatched.

At the same time, they aren’t accepted everywhere, so I also carry a MasterCard. I chose to get a Capital One card because it doesn’t have any foreign transaction fees, which is helpful any time I travel abroad.

So as you can see, I actually have two “best credit cards” for two different situations. When traveling abroad and when American Express isn’t an accepted form of payment.

That said, it doesn’t always come down to a single credit card. A combination of credit cards may be best.

One for a particular situation, one everyday card, and one for something else, such as a balance transfer that you need to pay off.

I’ve summed up all the different types of credit cards out there in my other piece, “what credit card should I get.” There, you’ll be able to break it down better and decide what you need based on your own needs.

And remember, it’s okay to have a few credit cards for different purposes. I do, and it certainly helps my credit history over time to have multiple, healthy active accounts.

(photo: frankh)

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