How to Choose the Best Credit Card in 3 Easy Steps

If you’re looking for a new credit card, you may be overwhelmed by the hundreds of options available. There are a seemingly endless variety of cards that offer rewards, interest-free periods, and opportunities to accumulate credit, which can make it difficult to find the right card for your wallet.

There’s no one-size-fits-all credit card, so the best credit card for you may differ from your friend’s. However, there are some steps you can take to help narrow down your options when it comes to getting a new card.

Here’s a simple three-step review you can follow to choose the credit card that gives you the most benefits.

1. Check your credit score and credit report
2. Decide which credit card is right for your needs
3. Shop around for the best credit card deals

The first step is to check your credit score and credit report. There are many free resources available, such as CreditWise from Capital One and Discover Credit Scorecard, where you can check your credit score. Plus, many of these services provide insight into the factors that affect your credit and offer advice on how to improve it. You do not need to be a Discover or Capital One customer to use these services.

Credit score ranges vary by credit scoring model (FICO or VantageScore), but creditors use the FICO Score in 90% of US lending decisions, so we list the ranges. vi below.

FICO Score Range

• Very poor: 300 to 579
• Equal: 580 to 669
• Good: 670 to 739
• Very good: 740 to 799
• Excellent: 800 to 850

Once you know which range you fall into, you can use that information to refine your credit card search. Consider cards that require credit equal to or less than yours. If you have good credit, consider cards with good or reasonable credit requirements.

Even if your credit score is in the good range it is not a guarantee that you will be approved for a credit card that requires good credit. Card issuers consider more than just your credit score, including income and monthly housing payments.

Credit cards can be divided into three main categories: rewards, 0% APR, and building credits.

Below we list each type of credit card best suited to which consumer.

Reward

If you don’t have debt and already have good credit, a rewards credit card can help you offset the cost of purchases and pay for upcoming travel (by redeeming points or miles). Reward cards come in all shapes and sizes with cashback, points or miles in common spending categories (travel, gas, shopping and dining) that can be redeemed for statement credits, gift cards, airline tickets, hotels and more.

Depending on the rewards card you open, you may get additional perks. Here are some of our favorites:

Terms apply to all benefits.

Referral APR 0%

If you want to get out of debt or finance new purchases, the 0% APR credit card can be a good tool that doesn’t charge interest on purchases, balance transfers, or both. Citi Simplicity® Card offers 0% introductory APR for 21 months on balance transfers from the date of first transfer and 0% introductory APR for 12 months on purchases from account opening date (afterward, APR varied from 16.24% to 26.24%. Balance transfers must be completed within four months of account opening.

During interest-free periods, you can benefit from substantial savings instead of carrying around a balance on a high-interest credit card, where part of your payment will be charged to interest charges.

The best balance transfer credit cards don’t have an interest term of at least a year, and some also offer a hard-to-find $0 balance transfer fee.

If you have a big purchase coming up, consider putting it on an introductory 0% APR card and not be charged interest while repaying. Just make sure to pay off your balance in full before the referral period ends.

Be aware that the best 0% APR credit cards often claim good or excellent credit.

Credit building

If you don’t have a lot of credit history or have a less than excellent score (669 or less), you should prioritize building credit over rewards or special financial incentives. A good credit score is key to unlocking the best interest rates and increasing approval rates for credit cards, mortgages, and loans.

There are credit cards that are specifically designed to build credit or for people with decent or average credit that can help you improve your score. Secured cards tend to be a popular choice for those new to credit and those with bad credit. Just provide a security deposit, usually $200, and get the same line of credit as the deposit. You can then use a secure card just like a traditional unsecured card.

The Discover it® Guaranteed Credit Card is a great option in part because it also offers cashback: Earn 2% cash back at gas stations and restaurants on combined purchases of up to $1,000 per quarter , then 1% and earn 1% unlimited cash back automatically on all other purchases.

Once you’ve decided which credit card meets your needs, it’s time to shop for the best credit card deals. Review bonus categories for rewards cards, referral times for 0% APR cards, and credit tools for cards that help you build credit.

Also, don’t forget to depend on fees and interest rates in your decision. That includes annual fees, foreign transaction fees, late fees, and APRs.

If you’re having trouble choosing a card, consider submitting an online prequalification form to see if you qualify. You can submit multiple prequalification requests without any damage to your credit score, as it involves a slight reduction in your credit – this has no impact on your credit score. Please note that prequalification is not a guarantee that you will be approved for the card and submitting an application will affect your credit score.

If you pre-qualify for one credit card and not another, it can be a good indication of which card you should apply for.

Information about the Citi Rewards + ℠ Student Card and the Capital One Venture Rewards Credit Card has been independently obtained by Select and has not been reviewed or provided by the card issuer prior to publication.

For Discover it® Cash Back prices and fees, click here.

For Discover it® Security Card prices and fees, click here.