(Picture source: Mint.com)

Good Morning, and Happy Money Monday!  First off, I want to apologize for being completely out of touch last week.  The cold I thought I was fighting turned out to be the flu.  I felt so listless I had a hard time dragging myself to the doctor, I didn’t realize it, but I had a 101 fever.  Oops.  It took all week to recover.  I finally made it to work Friday, but I’m only now feeling like myself again.

So. . . Money Monday.  Today I’d like to talk about credit cards. This is not intended to be a credit-counseling post, nor will it cover the effects opening or closing credit card accounts may have on your credit score.  We are simply talking about the types of cards available.

Banks are loosening credit a little, so credit cards are easier to qualify for.  There are so many types.  Some cards offer cash back or discounts on purchases.  Others feature airline miles or points toward goods and services.  Some offer low interest, or no interest for a promotional period if you transfer another credit card balance to them.  Which should you choose?

First, it is paramount that you understand the concept of credit. Your credit limit is the amount you can borrow. It is not the same as money in the bank.  I talk to so many people who seem to believe the latter. Whatever amount you charge, you will have to pay back.  The longer you take to do that, the higher the true cost of the purchase.

Master your credit or it will master you.  The disciplined approach to credit is to charge only as much each month as you can pay off each month.  Much easier said than done.  But if this is you, credit cards with benefits are a good choice.  You may prefer a cash back card.  If you like to travel, cards with airline miles can be a good option.  Be careful with these, however.  If the card is not sponsored by an airline you may have a hard time converting your miles to actual plane tickets.

Most credit cards come with high interest rates.  If you don’t tend to pay your balance off each month, a card with a lower interest rate would be a good option for you.  Many cards start with a low-interest promotional period.  Others offer zero interest if you transfer the balance of an existing card.  These might be worth looking into so you can get the balance paid off more easily.

I hope this gives you a little more info about the types of credit cards available.

To your better wealth,