Finding the Right Type of Credit Card to Suit Your Needs


The following is a guest post. Enjoy! 

Finding the Right Type of Credit Card to Suit Your Needs

There are many good reasons (and perhaps, a few bad reasons) why someone would want to have a credit card. From desiring to improve/build your credit history to having a way to pay for everyday items without having to keep large amounts of money in your non-interest bearing checking account, credit cards, if used properly and paid off in full each month, can be a big help to a person’s life.

After making the all-important first decision that you indeed want to get a credit card in the first place, the question then shifts to what type of card is going to be best for your specific circumstances and life.

Listed below are several of the most popular types of credit cards and some of the deciding factors that can help you determine whether or not that specific type of card would be a good fit.   

Cash-Back Credit Cards

Cash-back credit cards, as you might imagine, are a very popular choice among credit card consumers because a certain percentage of EVERY purchase you make (regardless of the merchant) gets returned to you in the form of cash-back rewards. In other words, you get cold hard cash back as opposed to only getting a discount on future purchases at specific stores, as with some of the other rewards cards discussed below.

The bottom line here is that cash-back cards are the best for someone that wants to see the rewards return on their purchases as soon as possible. 

Airline, Points, and Gas Rewards Credit Cards

This category that could be summarized as “other rewards” credit cards allows you to accumulate rewards points on all of your purchases (regardless of the merchant). However, you often get added benefits for making purchases from the card issuer. For example, if you have an American Airlines credit card, you get certain perks and additional rewards points for purchases that you make towards flights with that airline. For a review of some popular airline credit cards, click here. Once you’ve accumulated a certain number of points, you can then redeem them by getting a discount on a purchase with the card issuer.

The bottom line here is that “other rewards” credit cards are good for someone that shops at one specific merchant VERY FREQUENTLY, or enough to make it worthwhile to be restricted to only redeeming the reward points with one merchant. 

Student Credit Cards

Student credit cards are generally low-balance starter credit cards for younger adults that are looking to get their first credit card that is not co-signed by Mom and Dad. These cards generally are typically somewhat “stripped down” in that they do not carry as good of rewards as other credit cards.

The bottom line here is that student credit cards are great for someone 18-25 years of age who is looking to get their first credit card and doesn’t have a lot of credit history built up yet. 

Pre-Paid Credit Cards

The last category of card on the list today is pre-paid credit cards. In fact, these are not credit cards at all, in a strict sense, because you are not being loaned any money. Instead, you send in cash to the credit card company, which is then loaded on the card for you to spend. These cards generally come with higher fees than the other types of cards on this list, since you’re paying for an added service from the credit card company.

The bottom line here is that pre-paid cards make sense for someone that has bad credit history and can’t yet get a regular credit card, but wants to start gradually restore their credit history. 

How about you all? What type of credit card do you carry? Why did you pick that specific category of card?

Share your experiences by commenting below!

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  1. I am a huge fan of the cash back and sign up bonus cards. I make a few hundred every year for simply spending what I would have spent any way because I never carry a balance!
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