Comparing Types of Credit Cards

Today, credit cards come in many different levels with varying interest rates, fees, and reward programs. It’s important to know which best suits your financial situation and lifestyle before you fill out an application.

Here’s a brief description of the most common types of credit cards available in the market.

Standard Credit Cards

These are the most readily available cards you can get from most banks and financial groups.

Balance transfer credit cards: These cards allow you to transfer a high-interest credit card balance onto a credit card with a low interest rate.

Low-interest credit cards: These cards give you an APR that starts out low and then jumps to a higher rate after a certain period or offer a single low fixed-rate APR.

Credit Cards that Have Rewards Programs

Reward credit cards: These cards let customers earn incentives, such as points, for making purchases with their credit card which can be redeemed for various rewards.

Cash back credit cards: This card lets you earn cash rewards for making purchases, so the more the card is used, the more cash rewards you will receive.

Bad Credit and Credit Repair Cards

Credit can very easily go from good to bad because of poor budgeting or an overlap between jobs.

Secured credit cards: These cards require collateral for approval which generally needs to be of equal or greater value than the credit amount.

Prepaid credit cards: These aren’t credit cards but are used and accepted just the same. The advantage of these cards is that there aren’t finance charges and they help you avoid debt since all purchases are paid for beforehand.

Specialty Credit Cards

These cards are for those with unique needs for their credit use, like business professionals and students.

Business credit cards: These are available for business owners and executives with features like low introductory rates, cash back programs, and more.

Student credit cards: These are specifically designed for those in accredited four-year colleges and universities, helping them build a credit history from the ground up.

Airline Mile Credit Cards

These cards allow points to be redeemed for plane tickets (among other things).

Airline-specific credit cards: These are associated with one airline, with customers making purchases with the card and by flying on the airline.

Generic airline miles cards: These let you redeem your reward points through any airline, travel agent, or online travel site.