Tips on Choosing the Right Credit Products

Credit Card Application

There are 3 types of credit cards:

1. Local bank cards from Bangkok Bank or Thai Farmers (thailand) , for example

2. Local bank cards affiliated with VISA, MASTER, American Express, etc.

3. Cards with no bank affiliation, such as American Express or Diners Club

The obvious benefit of the second and third types is that you can use them worldwide. While local cards charge lower fees, they can only be used domestically.

The third type are largely charge cards. Full repayment is due on your next month's billing. In case of delayed repayment, a steep fee is applied. The good thing with this type of card is that it helps you manage your debt level.

As mentioned earlier, it is important that you don't get into a credit trap, running multiple balances on many cards in the knowledge that you cannot to repay the debts. The easiest way to control this is to have no more than 2 different cards that offer the most benefits, such as discounts, points, etc. and make sure you clear your balances every month.

The 3 things you need to consider when choosing a credit card

1. Entry and Annual Fees
They are important because it is cash out of your pocket from day one. Many credit card companies now waive the entry fee and the first year membership in order to entice new customers.

2. Benefits and Discounts
Offers by the credit card companies will kick in only when you spend money in those establishments using the cards. The benefits ranges from frequent mileage points to saving on purchases. Choose the card that offers benefits or discounts at the places at which you are already a customer or that fit in with your spending pattern. Remember, it is useless for you to have a card that offer discounts to a hundred places you'll never visit.

3. Interest Rates
Should be the last item of consideration if you are financially wise. Why? Because as a wise consumer you would not spend more than you earn and you know better than to keep the outstanding balance on your cards and pay 20-25% in interest.