Know Terms to Compare Card Offers

All credit cards come with a collection of terms. These are the rules for using the card. The terms must be reveal in the card application brochure; they're also on the back of every statement.

Some of the most important terms you should be aware of are the interest rate (which is charged or paid for the use of money), annual percentage rate (APR), due date, grace period (the interest-free period of time between when you make a purchase and when you pay for it), cash advance rates, transaction fees, the late fee, the over-the-limit fee and other charges.
Always read the card terms carefully before you apply.

Focus which credit terms and conditions is the best for You, this can add up to very respectable savings over a period of time.

Credit Card or a Charge Card?

With a traditional "credit" card, you charge items on your account and receive a bill later, which you have the option to pay in full or in part (you must pay at least the minimum payment amount each month). If you don't pay the account in full, the remaining balance will carry over to the next month and finance charges will be assessed. This is referred to as revolving credit.

The other type of card, often referred to as a "charge" card, doesn't allow you to carry a balance from month to month; you have to pay off the total balance when you get your bill. These cards offer the convenience of plastic without the danger of getting into debt or paying high interest charges.

Both kinds of cards are offered under a variety of labels ( gold, platinum, premier, and the like), each one offering different features and benefits. The gold and platinum types of cards are typically offered to consumers who have an excellent credit history.

It stays to wish all only platinum cards.

Before you begin using credit, be sure you understand the basics.

If you are like most consumers, you're willing to get a credit card. That's reasonable - they offer convenience (no need to carry around wads of cash), enable you to take advantage of opportunities (that TV you've been looking at just went on sale and you don't have your checkbook with you), and can get you through emergencies (try giving the tow truck driver an IOU when your car breaks down on the highway).

Establishing credit is also a must if you plan to ever borrow money to buy a car or home.
Credit can also get you into trouble. At best, credit cards can make it difficult to stick to a budget. At worst, they can tempt you to overspend to the point of not being able to pay your bills.

To enjoy the benefits of credit and avoid the potential pitfalls, you need to understand the basics of getting, using and managing a credit card.