CIBC: How to Pick the Best Credit Card to Save Money in 2021
TORONTO, April 13, 2021 (Newswire.com) - The best credit cards for 2021 come with a wide selection of features that can help save cardholders money. From sign-up bonuses to low or no annual fees, users of these cards will have multiple ways to save some of that hard-earned cash. Keep reading for more information on how to select the best credit card to save money in 2021.
5 features to save money in 2021
1. Low introductory APR for balance transfers
Some cards offer introductory low APR rates for balance transfers, meaning new cardholders move money from a high-interest credit card to their new balance transfer card. A well-timed balance transfer will mean a period of time where it's possible to pay down debt with no interest. However, people interested in a balance transfer should be sure they can pay off their bills by the time the promotional period is over — otherwise, they'll be stuck paying the regular interest rates.
2. Low interest
Low-interest credit cards may allow people to save on interest payments if they carry a balance. Unlike a balance-transfer offer, this refers to the ongoing interest rate that their credit card will have moving forward. If they don't pay their full statement each month, this is something that they should consider when deciding on a card.
3. Low or no annual fee
Cards with low or no annual fees can lead to saving money every year. However, before choosing a card, it's important to take a close look at the benefits of both low/no-fee cards and cards with annual fees. The ongoing benefits of the fee cards can sometimes outweigh the extra cost.
4. Sign-up bonus
Some cards offer lucrative sign-up bonuses, sometimes worth hundreds of dollars. While these can be valuable, keep in mind that this is only a temporary perk. Once it's been earned, the benefit is over.
5. Attractive rewards
When choosing a new card, people should look for a rewards card that best fits their lifestyle. They can save money using a card that offers rewards on the spending categories they use the most. For example, for people who travel often for work, a card with travel benefits can lessen their expenses on the road. For people who still consider cash to be king, it may be better to consider a cash-back card.
Credit card perk considerations
One should make sure to consider the following three factors when considering one's options:
- Flexibility: How easy is it to redeem and use rewards?
- Value: How much are rewards actually worth when a cardholder goes to cash in?
- Earning: What's the dollar-to-reward exchange?
How to find the best credit card to save money
Here are a few final tips to help people pick the best money-saving card:
- Do a credit check: Before applying for a card, people should check their credit score. This will give them a sense of which cards they can qualify for.
- Select the best card type: Pick a card type that works best for each individual's spending habits and lifestyle. Then narrow down the choices. Do their spending habits best suit a low-APR intro period or a card with a regular low-interest rate? An airline rewards card or one that puts cash back in their pocket every month?
- Apply: After making a choice, it's time to apply. After being approved and receiving a card, the new cardholder can finally start spending (and saving).
Source: CIBC
