There are many choices to pick from when applying for a credit card. Among the options are cash back credit cards, travel rewards credit cards, and low interest credit cards. Each type saves money in different ways.

With so many options available, it’s easy to find cards that suit different lifestyles and preferences.

Choosing the Best Credit Card

When applying for a credit card, potential cardholders should first assess their spending habits to get an idea of how much they’re spending, what they’re spending it on, and how their repayment habits may impact their needs. For example, avid travellers will likely get the most use out of a travel rewards credit card, while those who carry a balance might do better with a low-interest card.

Cash Back Credit Cards

Cash back credit cards offer cash back for purchases made using the credit card. Some cash back cards offer money back on every purchase, while other cards are category-based. The rewards earned can be applied as a credit to the monthly statement or deposited into a bank account.

Category-based cash back credit cards offer significant rewards for purchases made in specific categories. If a person uses their credit cards most often for groceries and everyday items, selecting the grocery category will maximize their rewards.

Categories can change. If a cardholder is planning a major electronics purchase, waiting for that category to come around before making the purchase can result in extra cash back. With some cards, it’s easy to opt out of that category once the purchase is made and go back to the card’s usual reward categories.

Travel Rewards Credit Cards

With a travel credit card, points and miles are earned on purchases made at participating establishments and on travel-related purchases. Redeeming points or miles is simple.

Cardholders maximize their rewards by using their card for travel purchases. The rewards can then be used to pay for flights, hotels, vehicle rentals, and other travel-related expenses. Or they can be used to enhance the travel experience with upgraded seats, access to airport lounges, access to free in-flight Wi-Fi, and priority boarding.

Low-Interest and Balance Transfer Credit Cards

Low-interest credit cards and balance transfer credit cards are great resources to consolidate debt and save money on interest.

Low-interest cards offer a significant reduction in the amount of interest accrued if the balance isn’t paid in full each month. Interest on purchases can quickly add up and eat away at the monthly payment, so lower interest rates save money.

Balance transfer credit cards allow cardholders to transfer the balance of one card to their new card with a lower interest rate. Often the card comes with a set amount of time that there will be an extremely low, if not 0%, interest charge. They offer little in rewards, but saving money on interest fees is, itself, a reward.

Taking advantage of the introductory, low-interest rate offer can lower the principal amount owed, as opposed to only paying off the interest. These introductory offers can last for 6-18 months, which can help to significantly decrease debt.

No Annual Fee Credit Cards

If someone is an occasional credit card user or only has the card for emergencies, a card without an annual fee is the best option. The rewards aren’t as plentiful, but this option generally makes sense if the card is used infrequently.

Tips for Comparing the Cards

When applying for a credit card, shoppers often compare these different factors:

• Interest rates
• Benefits offered
• Fees
• Introductory offers

Everyone should consider their own personal lifestyle and spending habits when deciding which card will be right for them.  Travel perks wouldn’t make sense for someone who prefers staycations. And an annual fee might be a dealbreaker for one person, but worth it for another.  Choosing the right credit card goes a long way toward maximizing rewards and saving users money.