Everyone has received countless credit card offers in the mail.  They all sound amazing at first, but how do you know which one is right for you?  They all offer a free cruise vacation or a free DVD player, how do you tell which card is out to get your money and which one will actually help you in the long run?

One way to make sure you do not get caught up in a scam is to shop around for a credit card.  Do not accept the first offer you receive in the mail, chances are it will not be right for you and you may end up with debt because of rates that were not properly explained to you.

Most credit cards are based on what is called a “revolving balance.” Basically it is determined ahead of time, based on your credit history, what your credit limit is.  After this is decided your card is limited to that amount.  If you buy something for fifty dollars, fifty dollars is deducted from your balance.  After a certain point you reach the end of your balance unless you pay your bills.  For instance, once you pay that fifty dollars it is added back into your balance.  This is why it is called a “revolving” balance. This is the most common type of credit card and also the most recommended since it helps stop you from spending more money than you can afford, a common danger of using a credit card.

But a “revolving balance” may not be for you.  If you plan on repaying your entire balance at the end of each month you may just need a simple charge card.  A charge card just keeps track of how much money you have spent and helps you organize your bills at the end of the month. 

It is also important to consider what types of transfers you will be doing most often.  For instance there is generally an interest rate on balance transfers unless you specifically find one that does not have that interest.  Make sure you consider all of these factors while looking for a card so you do not end up with one that works poorly for you.

One of the most important factors to consider, regardless of what type of card you decide to get, is the APR, or annual percentage rate.  Every credit card will have some type of APR.  The lower the APR the lower the amount of money you will have to pay the credit card company at the end of each year.  Finding a card with a low APR is extremely important.

There are many other factors you want to consider when looking for a credit card.  For instance what is the grace period of the card? If you are worried about paying your bill on time you should check and make sure you have a few weeks leeway.  You should consider all of these factors.