“How do I know which credit card to apply for?”
The question above is, by far, one of the most common questions I get from people looking to apply for a credit card. Many people have an idea of what their credit score is, but may not know it exactly. Even if some people have a ballpark estimate of what their credit score may be, they are often nervous to apply for a certain card because they believe their score to be somewhat on the borderline of what the card requires.
Well, the first step in choosing a credit card is getting a good idea of what your credit score is. Companies like Credit Karma offer free tools to check your credit score. Although the score they will provide you is not a FICO score, it is usually pretty close. Alternatively, there are other services out there that usually require a small monthly fee such as myFICO and Citi Identity Monitor that will give you an exact measure of your FICO score, and alert you if there are ever any changes to it.
Once you know your credit score, the next question you have to ask yourself is: “What do I want to get from using my credit card?” There are so many different types of credit cards on the market, and each one is different. You want to make sure you compare credit cards thoroughly in order to determine the best card for you. Cards can offer a host of different benefits such as airline miles, rewards points, cash back, no interest on purchases, no interest on balance transfers, a variety of bonuses, and more. Knowing what type of reward or benefit you would like out of your credit card will make the decision process much easier.
Now that you know your credit score, and what you aim to get out of the credit card you apply for, it’s time to actually select a credit card. There are literally hundreds of credit cards on the market, so it can be difficult to make a decision, even if you have a good idea of what you want. In working with credit cards each and every day for years, I have a pretty solid idea of what the best offers are on the market for each credit score range and type of card. Below I will break down a few of the best credit cards for each credit score range so that you can make an informed decision. I’ve chosen to focus on cash back credit cards, balance transfer credit cards, rewards points credit cards, and travel credit cards.
The Best Credit Cards for Excellent Credit
Capital One® Cash Rewards – The Capital One® Cash Rewards card is my favorite cash back credit card geared towards people with excellent credit. With the Capital One Cash Rewards Card, cardholders receive a $100 bonus after spending just $500 on purchases in the first three months that they have the card. The card also offers 1% cash back on all purchases, as well as a 50% bonus at the end of each year on the cash back earned throughout the year. With this bonus, the effective cash back rate that the card offers is 1.5% on all purchases, which you would be hard-pressed to find on any other card currently available. The Capital One Cash Rewards Card also requires no annual fee, and offers a 0% introductory APR on both purchases and balance transfers until April of 2014.
Capital One® Venture® Rewards Credit Card – The Capital One® Venture® Rewards Credit Card card is currently my pick for the best all-around travel credit card on the market for people with great credit. With the Capital One Venture Rewards Card, cardholders earn 2 miles per dollar spent on purchases. In addition, cardholders receive 10,000 bonus miles when they spend $1,000 on purchases in the first three months that they have the card, which is equivalent to $100 in travel rewards. The miles earned from the card can be redeemed for any travel expense including airlines, hotels, transportation, and more. The Capital One Venture Rewards Card reward miles return approximately 2% per dollar spent when the miles are converted into dollars. The card requires a low annual fee of $59, but it’s waived in year one.
Slate® from Chase – While this card only requires good credit, rather than excellent, it still deserves to be listed here because the Slate® from Chase card is the best card for transferring balances currently available. This is because the card offers a 0% introductory APR on balance transfers for 15 months. While some cards may give you the same introductory period for 18 months, the Slate Card is one of the few cards on the market that do not require a balance transfer fee of 3%. You read that correctly: it is free to transfer a balance from your current card to the Slate from Chase card in the first 60 days that you have the card. In addition, the card also offers that same 15-month 0% interest intro period for purchases. Lastly, the card does not require an annual fee to use.
Barclaycard Rewards MasterCard – Excellent Credit – The Barclaycard Rewards MasterCard for Excellent Credit is one of the newer offerings from Barclaycard, and is my favorite rewards points credit card on the market. With this card, cardholders earn a 5,000 point bonus just for making their first purchase or balance transfer with the card. These 5,000 points are equivalent to a $50 statement credit. Cardholders also earn 2 rewards points for each dollar spent on gas, groceries, or utilities, and 1 point for each dollar spent on any other purchases. The card also offers a 0% introductory APR on both purchases and balance transfers for 12 months, and requires no annual fee. Rewards points earned with the card can be redeemed for virtually anything including airfare, merchandise, electronics, dining, entertainment, and more.
The Best Credit Cards for Good Credit
Discover it® – The Discover it® is a new credit card just launched by Discover in January of this year, and is a great cash back credit card for people with good credit. With the Discover it®, cardholders receive 5% cash back on categories that rotate throughout the year such as restaurants, home improvement stores, gas, travel, and more. Cardholders also receive 1% cash back on all other purchases throughout the year. What makes this card great, however, is that it also offers a 0% intro APR period on both purchases and balance transfers for 14 months. In addition, the card has no annual fee, no overlimit fees, no foreign transaction fees, and no pay-by-phone fees. Discover also will not charge you a late fee on your first late payment, or increase your APR for paying late.
Slate from Chase Card – See my review above.
Capital One® VentureOne® Rewards Credit Card – The Capital One® VentureOne® Rewards Credit Card is an excellent travel credit card choice for people with good credit. With the Capital One VentureOne Rewards Card, cardholders earn 1.25 miles for each dollar spent on purchases. In addition, the card offers 10,000 bonus miles when the cardholder spends $1,000 on purchases in the first three months that they have the card, which is equivalent to $100 in travel. Miles can be redeemed for flights, hotel rooms, car rentals, and more. The card also offers a 0% introductory APR on purchases until N/A, and requires no foreign transaction fees or annual fee.
Citi ThankYou® Preferred Card – Bonus Point Offer – The Citi ThankYou® Preferred Card – Bonus Point Offer card is my favorite rewards points credit card geared towards people with good credit. With this card, cardholders receive 15,000 bonus ThankYou points after spending $1,000 on purchases in the first three months that they have the card. These 15,000 ThankYou points can be immediately redeemed for a $150 gift card, or $150 worth of rewards from the Citi ThankYou online store. Cardholders receive 1 ThankYou Point for each dollar spent on purchases, and can earn extra points when shopping through the ThankYou Bonus Center, which is a network of over 600 popular retailers. Also, the card has no annual fee.
The Best Credit Cards for Bad Credit
Capital One Secured MasterCard – The Capital One Secured MasterCard is my choice for the best credit card for people with bad credit. The card offers automatic reporting to the three major credit bureaus (Experian, Equifax, and TransUnion), and also offers online reporting tools that allow you to track your credit score, and the tools also offer suggestions on how to improve your credit. Since this is a secured credit card, it does require a deposit, but you can get a credit line of up to $3,000, and also get additional credit line increases without having to plunk down another deposit. The card has an annual fee of $29, which is very low for a secured credit card. With responsible use of the Capital One Secured MasterCard, you can be well on your way getting your credit score healthy again.
Continental Finance Matrix Discover Card – The Continental Finance Matrix Card from Discover is a great choice for people with bad credit who want a credit card, but don’t want to put down a cash deposit to get it. The card offers reporting to the three major credit bureaus, and can help someone improve their credit score if they use the card responsibly. The card requires an annual fee of $75, and a monthly maintenance fee of $12. The monthly maintenance fee does not start until the second year you have the card, however. The card is free to apply for, and offers instant approval even for very poor credit.