Bankers Diary

5 Questions To Ask Yourself Before Getting A Credit Card

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Perhaps you know about Oprah Winfrey, America’s well-loved TV anchor, actress, producer, book writer, and donor. Several times in The Oprah Winfrey Show, the host would help change the lives of her viewers by giving left cars, vacations, and in some cases, by paying off house loans or credit card bills etc… Whether or not those actions helped Oprah’s beneficiaries in the long term, it was clear that lots of people live in the burden of debt—thanks to their credit card woes.

Having a credit card is a major financial responsibility. Maintaining one (or several) can make or break your life dependent on how you use it. Before submitting your next credit card request, here are few useful questions that you should ask yourself first.

1. Why Do I Need A Credit Card?

The 1st and most important question that why do I need a credit card? I will explain here, the effective word here is “need.” Generally, the answer to this question is to either increase your spending power, to collect reward points for your purchases, or to do away with cash altogether.


For those of if you have already a credit card, then a very simple question ask yourself why you need additional, extra or alternate. We recommend going back to your credit card usage history to see your spending patterns. Are your previous expenses for your wants or your needs? Have you been a responsible cardholder? Can you really handle another one? And are you paying your credit card bill regularly on monthly basis within due date?

2. What Is The APR?

If you are thinking about to apply for credit card first time, then you need to know what is APR? APR stands for Annual Percentage Rate of interest/markup. Mean to say the amount that will be charged to you on top of your full balance if you don’t pay for everything on your monthly due date. In simply words how much services charges or late fee charges and markup you will pay on your unpaid amount of bill.

Surely, you’d want a card that has the lowest Annual Percentage Rate for obvious reasons. Some credit card providers even offer a zero APR during the first few years of your contract, but this may change after a certain period in sense of Annual Fee charges, Card renewal fee or some other hidden charges.

3. How Does This Card Compare With Others?

It’s always a good idea to lookout for the best card that fits your needs and which bank offering amazing offers on purchase of different goods and special discounts on restaurants and shopping malls etc… Do you frequently use your card for big ticket purchases? Or are you more of an online shopper? The competition may not just come down to the lowest fees and interest rates, but with the company’s customer service as well.

Look for reviews online to see what people are thinking about a particular credit card company or bank. Be serious enough to separate the wheat from the chaff.

4. How Much Is The Annual Fee?

Annual fees may depend on the type of credit card you’re getting. If you’d like to take advantage of premium bonuses and privileges, be ready to split out slightly higher annual fees. Some banks allow you to test out the card first by waiving the annual fee for the first year, while some don’t have annual fees altogether. Always read and reread the fine print.

5. Is There A Rewards Program?

Some credit cards are highly famous because of their rewards program—allowing you to save some cash on your purchases. Use it as a standard to assess which credit card you should choose, especially if your main purpose for it is to collect points.

To sum it up, getting a credit card is a big responsibility. You’ll be dealing with fees, interest rates, charges, and due dates which can be overwhelming for a first timer, but the suitability and rewards you’ll get in return when you properly use a credit card outweighs the fears of having one.

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