Are you planning on applying for a new credit card? This can be a serious financial step that could impact you negatively if you don’t take the time to carefully consider your decision. The following are 5 very important questions that you need to ask yourself before you apply for a new credit card.
Do I need a credit card right now?
You need to consider whether or not you actually need another credit card in your life right now. Why do you want the card? Are there some expenses that you need to pay which you won’t be able to pay in a different way? Are you in a solid financial situation that will allow you to buy some items using a card without finding yourself drowning in fees and constant minimums? If you don’t need the action to take is simple: don’t get one.
What are the fees associated with this card?
You must also ask yourself what fees are associated with the card. Does it have high fees? Fees associated with certain types of transactions? The more you know about the potential fees, the better. Make sure that you thoroughly read up on any fees a card may have so you aren’t surprised if you get hit with them.
Am I making enough per month to pay off the minimum?
You need to make sure that you are, at the very least, making enough money per month that you can always pay off the minimum. If there is even the chance that you won’t be able to pay the minimum on the card, then you need to skip it. It’s not worth the risk.
Are there any rewards for this credit card?
You should ideally look for a credit card that offers rewards, especially since there is so much competition in the credit card market that more and more companies are offering great rewards for their users. Look for a card that has rewards which you will actually use, whether they are travel perks, free hotels stays, or something else that interests you. You should also consider how easy it is to get rewards on the card; if they’re unobtainable, they may as well not exist.
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Is this the best card for me?
Finally, you need to carefully consider the question of whether or not this is the best card for your needs. The card that is best for your needs will be a card that is beneficial to you while not being too expensive or financially out of your league. If it’s not the best card for you, but you still need a credit card, you should keep looking at other options until you find something that suits your needs. Remember, there are lots of credit card companies out there, so you will likely be able to find a card that matches your needs while providing you with great benefits.
Remember, don’t get a new credit card without asking yourself the above essential questions.
Josh is an entrepreneur and financial expert with over a decade on Wall Street as an economic strategist. His career started in finance, progressed to owning multiple business, and now shares his insights and life hacks with readers of DailyWisely.com.
Josh's work and authoritative advice have appeared in major publications like Nasdaq, Forbes, The Sun, Yahoo! Finance, CBS News, Fortune, The Street, MSN Money, and Go Banking Rates. Josh currently shares his financial expertise in investing, wealth management, capital markets, taxes, real estate, and personal finance on his personal finance site, Top Dollar Investor.
Josh graduated from Cornell University with a degree from the Dyson School of Applied Economics & Management at the SC Johnson College of Business.
Josh is the owner of Top Dollar and Daily Wisely, the former focusing on personal finance and wealth building strategies, while this site focuses on living well and enriching content that Josh curates with his team.