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Wondering how to choose the best credit card for yourself?

Wondering how to choose the best credit card for yourself?
By Ajita Jha

Credit cards, without any second thought, are one of the most important financial tools that help us sail through the uncertain or tough times. These days, there are a plethora of options available in the market especially when it comes to choosing credit cards. Such wider availability, no doubt, can make you feel overwhelmed or confused. You may even become more baffled especially when you are looking to sign up for a credit card for the first time. From points, benefits, perks, to air miles and cashback rewards, several factors are needed to be taken into consideration before making a final decision.

Then there are people who are totally new in the world of financial management and are not very familiar with money management habits which can increase the chances of getting a poor credit score that can impact them in a long run specifically when applying for a bank loan. However, do you know, in this ever-evolving financial world, there are certain cards that can help you save money?

Before getting a credit card, it is always advised to carefully go through all the options and then pick and choose the one which could best suit your interests, needs, and lifestyle. But before going ahead with the comparisons, it is imperative to know what obtaining a credit card actually means and why is it important to maintain a good credit score.  

Things to look for before getting a Credit Card 

  1. Unless you are applying for a student card, you will be required to have a minimum salary requirement.  
  2. You should be able to maintain a good credit score as this represents how responsible and reliable you are in making on-time payments of your bills. With poor credit score, your ability to borrow will get severely impacted.
  3. You need to have a fair idea of your spending habits. To garner the maximum benefits from your card you should know where all your money goes and what do you spend most of your money on.
  4. You also need to analyze your purchasing habits. If you shop offline or online more. There are certain cards that offer special rewards for online purchases while there are others that offer rewards on offline purchases.

The different kinds of credit cards 

  • Reward cards
  • Cashback cards
  • Air miles cards

There are plenty of cards available depending upon your requirement, there are balance transfer credit cards for consolidating debts, pre-paid cardsbalance transfer virtual credit cards, and so on. Every time you spend money through a credit card, you can expect a reward sooner or later. Hence, there are cards that might serve your interest better than the others. That is why it is important to compare before you actually get it.

The Best Credit Cards in Singapore 2020

Best Cashback Credit Cards 

In a cashback credit card, you will receive rewards after spending on groceries, dining, hotel stays, online shopping, entertainment, and much more. Following are the best cards in each category:

  • For groceries: Citibank Cashback, Maybank Family & Friends, Citi SMART Card
  • Big Ticket Expenses: SCB Manhattan World, AMEX True Cashback
  • For online shopping: CIMB Visa Signature, SCB Spree, OCBC FRANK

Best Miles Credit Cards 

In this, with every Visa/Mastercard transactions, you will be rewarded with air miles. Given below are some of the finest miles cards you can choose from:

  • CITI Rewards Credit Card
  • CITI PremierMiles Visa Card
  • AMEX Singapore KrisFlyer Miles
  • OCBC Voyage Card

Best Rewards Credit Cards

If you enjoy redeeming rewards in the form of vouchers for shopping, movies, dining, air miles, hotel stays, then following reward credit cards are the best for you:

  • DBS Esso Card
  • AMEX CapitaCard
  • HSBC Revolution Credit Card
  • DBS Woman s Card

Best Student Credit Cards 

There are a lot of benefits that come with being a student especially in terms of entertainment or food discounts. And on top of that there is a wide range of student credit cards with considerably lower charges on prerequisites such as no minimum spend, no minimum income requirement, and much lower annual fees:

  • OCBC FRANK Card
  • Maybank eVibes Card
  • Citi Clear Card
  • DBS Live Fresh Student Card

Terms to be aware of before getting the Credit Card 

Credit card perks are something that excites all of us. However, one thing that you must know that credit cards come with additional charges. So, carefully go through the fine print and pay attention to all of their terms and conditions. Given below are a few of the terms you must be aware of:

  • Annual Fee: as the name suggests, it is a yearly fee that is charged for the convenience enjoyed by a credit cardholder.
  • Foreign Transaction Fees: whenever you will swipe your credit card in a foreign country, additional fees will be charged including currency conversion rate. To avoid extra cost on the overseas transaction, banks have introduced Multi-currency cards so that you can spend like a local whenever on holiday.

How can you improve your bad credit score? 

Yes, you can improve your bad credit score as the Credit Bureau of Singapore only checks the borrowing record over a period of 12 months. So try to maintain that at least for a year to get rid of a poor record. You should also take the following points into account:

  • Do not take several loans within a short period of time
  • Get your inactive credit cards canceled
  • Pay your bills on time

Conclusion

Hence, the goal is simple, take all the aforementioned points into consideration, be patient, and careful, before signing up for a new credit card for yourself. Always make comparisons using a transparent and unbiased website or consult your bank that can help you decide the most suitable credit cards on the basis of your needs and lifestyle.