How do I pick the right credit card for me?
Hi! I'm so glad you're writing in this question. Picking the right credit card is a decision that can continuously reward you as you go about your usual spending patterns. So how do you pick the right one? Let's dive in!
Don't have time for the whole thing? Here's a quick summary🔥
- 0% intro APR on purchases and/or balance transfers
- Intro periods up to 21 months
- Many options with $0 annual fee
- Welcome bonuses up to 75,000+ points or miles (select offers higher)
- Earn 2x–5x rewards on travel and everyday categoriesIntro periods up to 21 months
- Options from $0 to premium-tier annual fees
- Options available with no credit history requiredWelcome bonuses up to 75,000+ points or miles (select offers higher)
- Earn 1%–5% cash back on eligible purchasesEarn 2x–5x rewards on travel and everyday categoriesIntro periods up to 21 months
- Many cards with $0 annual fee
- Avg +57 pts in a year for users starting under 600 with on-time payments*Welcome bonuses up to 75,000+ points or miles (select offers higher)
- Reports to all 3 major credit bureausEarn 2x–5x rewards on travel and everyday categoriesIntro periods up to 21 months
- Plans from $5/month
1️⃣ Review your current spending patterns
✅ Go to your current bank account - whether it's a debit card or a credit card - and download the last few statements. Make sure they're representative of your typical spending patterns.
✅ Take your transactions and organize them according to spending categories. For example - travel, dining out, groceries etc.
If you don't mind uploading your data to ChatGPT, upload your bank statements and ask it to categorize the transactions for you. Two things to keep in mind - block out any sensitive data (such as your address) and proofread the work! AI makes mistakes too.
2️⃣ Look up your most recent credit score
Which credit card you qualify for will be mostly decided by your credit score.
Remember that applying for a new credit card, negatively affects your credit score, so you want to make sure that once you apply, you're confident you will be approved for the card.
✅ If you’re starting out, look at student cards since they often don’t have any credit score requirements. Here are our current favorite cards.
✅ If you’re re-building your credit score, secured cards are your best bet since they’re tailored for lower credit scores. Our top picks here.
✅ If your credit score is okay or good, focus on card perks tailored to your spending. Here are our favorite options for cashback!
✅ Have irregular income? Favor cards with low or 0% interest rates to reduce penalties if you can’t pay in full every month. Here’s our current favorites.
3️⃣ Evaluate fees vs benefits
Unless you're choosing a premium card, you should always go for a credit card that has $0 annual fee. However, if you're ready for a premium card or looking for certain perks, make sure you do the math before to see whether the benefits are worth more than the annual membership fee.
If you asked ChatGPT to categorize your transactions, you can also ask if a certain card is worth it based on your spending patterns. Make sure that the value of the perks you will actually use is more than the annual price of the card.
4️⃣ Compare sign-up bonuses
Credit card companies frequently offer sign-up bonuses. If you’re considering applying for a card, it’s worth checking whether the current offer is competitive. Below is a benchmark for what a strong sign-up bonus typically looks like by card tier. If an offer falls short, waiting may be worthwhile, as bonuses often increase at certain times of the year.
✅ No annual fee / beginner cards: $50-200
✅ Mid-tier cards: 20,000-60,000 points
✅ Premium cards: 60,000-150,000 points
5️⃣ Read the fine print
Based on your needs, you might want to optimize for a credit card that has more flexibility.
✅ If you know you have a lot of expenses coming up (e.g. you're moving and will need to buy new furniture), consider optimizing for a card that has the longest 0% APR offer to give yourself more time to pay back.
✅ If you have an inconsistent income, look for a credit card with the lowest APR to minimize any penalties.
Hope that helped take some of the stress out of credit card hunting! Make sure to do your research thoroughly & let us know which card you end up picking.
Best,
Kristina