Everyone gets a bit excited when he or she takes possession of a new credit card. Getting a line of credit of any kind does provide a sense of freedom and a feeling of pride. Whether you plan to use this card for some shopping or to finally take that long-postponed holiday, you know that you no longer have to postpone the decision. You can just go.
But there are a lot of different types of credit cards with different features and various benefits. Some of those benefits and features are great for just about everyone. However, other features will not be as comfortable for some individuals. That’s why everyone should look closely at the details before making a final decision on a card.
Perhaps the first question you should ask is one that you direct at yourself: why would I apply for this card? Positive reasons include low fees, no fees, low interest rate, or benefits and rewards. These should fit your specific spending habits. You might also ask how the card you are considering compares to at least two others. Make sure you know the interest rate and credit line or limit, as well as the annual percentage rate.
Before you take any time filling out the basic application for your card, find out if there is a minimum income requirement. If your annual income is above that limit you can continue. If not, you should probably look elsewhere. Some cards also have a minimum age limit, such as 21. There are a few other details that you should make sure to understand.
One of the most important is called the annual fee. Some cards have no fees for each year that you are a cardholder. Others have no fee for the first year, then have a reasonable fee each year after that. This is definitely one of the elements you want to understand clearly before you accept the card. It’s not a massive number but it can add up over time.
Paying the Piper
With any credit card, you have to make payments of some sort, even if it is the absolute minimum requirement set by the issuing bank. As you shop, you should learn about credit card IPP. These three letters stand for Instalment Payment Plan. For some of the most popular platinum cards, this is an automatic determination. If you spend more than a specific amount, then the card company splits payments into several months for you.
For example, use the numbers RM500 and RM1,000 as threshold numbers. If you spend RM600 the company divides that into three payments of RM200 automatically. If you spend RM1,500, the amount is divided into six payments of RM250. Other benefits that you can access with this card include no cap on rebates and an 0.5% rebate credited to your account automatically on all retail transactions.
When looking for the right card, make sure you understand all the details. Many of them can benefit you beyond your expectations, and save you a bit of money.