Credit cards are not as cut and dry as they used to be many years ago. With most credit cards over twenty years ago one simply had to look at the credit limit, interest, and a monthly payment. Most people knew what they were getting into when they applied for a credit card. In today’s world, there is a plethora of credit cards to choose from. Each one will have different incentives and options that will make one credit card better over another.

The world of credit cards have become just as competitive as some fast food restaurants. Credit card companies have also expanded to have more and more companies offering credit cards. There are credit cards for almost any situation for people to choose from. Wading through the many options however, can be daunting.

There are credit cards that offer to transfer the balance of one card to another. Credit cards that help people rack up on frequent flier miles, so that they can obtain cheaper flights. There are also credit cards that will give people cash back, and cards that will have a much lower interest rate than other credit cards.

Basic Credit Cards

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The more standardized credit cards offer a line of credit with a minimum monthly payment option. As long as the payments are made, this card can be used as many times as the card owner wants, as long as it does not go over the allowed limit. If the line of credit has been reached, a person cannot use the card again until enough monthly payments have been made to lower the balance.

Late charges will apply with this type of credit card, and unpaid balances will have an interest fee charged to it. Many students will benefit from having these type of credit cards.

Gold and Platinum

These types of credit cards are considered to be premium cards that reward their customers with cash back incentives for purchasing certain items. Card owners could receive a one percent cash back reward for every item they use the card on. They can also receive up to twenty-five percent cash back on larger purchased items. They will also have 0% interest, discounts, and bonus rewards. People who apply for these cards must have a good credit standing, and the monthly payments will be much higher than a basic credit card.

Premium cards will also give rewards for traveling with frequent flier miles. These cards will come in handy for people who travel a lot. If people do not use their cards that much, or travel, they may be better off having a basic credit card.

One Time Payment Charge Cards

These types of cards do not have a monthly balance due. When a person uses this card the payment must be paid back in full before the card can be used again. There is no interest for this card since there are no payments. Late fees will apply if the balance is not paid, and the card owner may be cut off from using the charge card if the balance is not paid.

Fee Based Cards

Fee based cards are secured credit cards that require the card owner to pay a fee to put on the card. This fee acts like a debit card where the only amount the person is allowed to spend depends on how much money the person paid on the card. When payments have been made on the card, the balance will open back up for more spending.

People who have poor credit can apply for these types of cards to help build up their credit scores. Younger adults and students who do not have a lot of credit, or no credit at all can also benefit from using these types of cards.

Specific Location Cards

These type of cards are limited on where a person can use it, such as gas cards that can only be used at a specific gas station, or a department store card that can only be used at one department store. They act as a basic credit card where the person can spend money on the card, but then make a monthly payment to free up the balance. There will only be a certain limit that is put on the card, and the card owner cannot go over the limit allotted.

Prepaid

The prepaid credit cards act like a secured credit card where the card owner puts money onto the card and then spends only that amount. The limit is solely up the person who is using the card. It is similar to a bank issued debit card where the person can only spend what is in their bank account. There is no monthly fee. The person just adds money when needed and spends at will. Prepaid credit cards are a good way to build credit up for people that do not have any credit, or their credit is poor.

Business Use Cards

Business credit cards are issued by a person’s place of business and can only be used by that person, for business purposes. Items purchased cannot be for personal use. Owners of these cards will make a monthly payment like a basic credit card.

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