Yes! That’s right – a personal finance article with an Olympic tie-in! If my laundry powder and razors are getting in on the action then why can’t this British blog? Today I want to explore the factors you should have in mind when choosing a credit card. Comparison website provide oodles of choice of credit cards, so I want to give you the ability to judge them all, and pick the one you’d give straight tens to!

Does APR Matter?

The first piece of information you will notice about each credit card is the Annual Percentage Rate or APR for short. The APR gives a quick and comparably statistic you can use to compare the cost of borrowing on the card for a full year. Rather than go into the technical details of the APR – I’m going to ask a far more useful question: Will the APR affect you at all?

For many of you, it won’t make a tiny bit of difference to your finances. That’s right, if you always pay your card off in full absolutely every month (preferably via an automatic direct debit) then you won’t ever be charged a penny of interest, and therefore 7.9% or 39% – it really doesn’t matter. In this scenario, ignore this rate completely and choose the card which has other features that you love.

For interest-payers – the APR should be the starting point of the comparison, and once you have found the credit cards with the lowest set of APRs available, you can then discern between the close competitors based on the other factors.

The Temptations Are Strong…

You’ll find many cards out there which have a link to a retailer or brand. You’ll find Manchester United cards, Amazon.com cards, British Airways cards on so on. Each card will carry a unique benefit not found on a standard card – usually in the form of a store discount or air miles scheme. These cards may suit hard-core fans of the relevant brand, but usually carry a slightly higher APR to compensate the provider for offering rewards, so they’re not necessarily the best cards to spend heavily on. Rather, use them like a sniper rifle – to purchase only the specific services for which they provide you a reward.

Introductory Rates Can be Great Value

Experience may have taught you to avoid introductory rates and look for the small print rates. With credit cards I would recommend you let promotions and offers back into your radar, because they can offer unbelievable value and last for longer periods than you would imagine. Some cards offer 0% interest on a balance transfer for 22 months. That’s a big saving against a typical credit card! However these do make it difficult to weigh up cards, as the different promotions for different lengths and different APRs can’t be compared along a simple scale.

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