If you are looking for a credit card, then you have probably received a barrage of emails and direct mail advertisements that are trying to entice you into signing on the dotted line. At the same time, you cannot take out a credit card from all of these providers. Therefore, how can you find the right credit card for you? The first step is to try to figure out what type of credit card works for your needs. There are several categories that need to be covered.

The Standard Credit Card

Standard credit cards are often called plain vanilla credit cards. This is because they do not offer any frills or rewards. While this might sound like a downside, this also means that these credit cards are easy to understand. If you are looking for a credit card that isn’t complicated, such as a first credit card for a student, this is the option for you.

In general, a standard credit card is going to provide you with a revolving balance up to a certain limit. If you keep an outstanding balance on this card, then the balance is carried forward to the next month with an interest rate charged. While you do not have to pay off the balance in full every month, this is recommended to avoid interest payments. At the very least, you have to make the minimum payment specified on the credit card.

The Balance Transfer Credit Card

For those who have a large balance on a credit card and want to avoid paying a large interest rate, one option is to conduct something called a balance transfer. Basically, you are taking the balance of one credit card and moving it to another credit card, using a second credit card to pay the balance of the first credit card.

The biggest reason why you might want to do this is to transfer a large outstanding balance on one credit card to another credit card that has a lower interest rate. This is similar to refinancing a home loan, only for a credit card balance. Of note, balance transfer cards might have fine print that includes a fee for the transfer. In order to qualify for this credit card, you will probably need a good credit score of 640 or above.

Rewards Credit Cards

This is the exciting category that most people are interested in. As the name indicates, reward cards are cards that provide you with a reward when you make certain purchases. For example, many people have credit cards that reward them with points that can be used to make a purchase on Amazon, pay off a portion of the balance, or be redeemed for cash. Other people have credit cards that provide them with travel rewards that can be used to buy plane tickets and hotel rooms.

Many reward credit cards have a large first reward that entices people into signing. For example, people who sign up for a travel credit card might be rewarded with two immediate plane tickets. At the same time, it is important to note that many of these credit cards have an annual fee. This annual fee is in place to ensure that you keep using the credit card.

If you don’t think you are going to keep using the card, then you do not want to pay the annual fee. While you could close the credit card to avoid paying the annual fee, this might hurt your credit score. Therefore, it is important to read the fine print on all reward cards carefully before signing.