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Focus on the basics when picking your credit cards

by Peter Andrew

The Guardian, a UK newspaper that's attracting more and more American readers to its website, recently ran a feature that asked "Are our household appliances getting too complicated?" It talked about "function inflation," the domestic-appliance industry's equivalent of the military's "mission creep," whereby something that starts off with a clear objective (boiling water, say, or invading Afghanistan) ends up way more complicated than was ever intended.

So, apparently, you can today buy a kettle that allows you to select the heat of the water required for different beverages. Or a vacuum cleaner that The Guardian describes as:

...this £150 [$227] monument to excessive disposable income [which] includes a "crevice tool", "dusting brush", "turbo tool", "stretch hose" and "flexi crevice tool". You know, for cleaning your flexi-crevices. Which, obviously, aren't a thing.

It was when The Guardian got onto washers that this writer saw the light. A couple of years ago, he was persuaded by a particularly glib store clerk to buy a seriously expensive appliance, largely because it came with an extraordinary steam function. By the time the machine was delivered, he was pretty hazy about precisely what that steam cycle was supposed to do, and the manual provided almost no guidance. Nearly 24 months later, the steam button is yet to be pressed.

Credit cards and function inflation

It's not a big leap to see the extent to which we're being swayed by function inflation when we choose our credit cards. True, we each have our own individual requirements for the card we want. But all too many come with the plastic equivalent of steam cycles: they sound great, but we're never, ever going to use them. And it's possible they're going to cost us.

Isn't it time we sharpened our focus when we come to selecting the credit card we want? After all, it's not rocket science. Heck, it's not even domestic-appliance engineering.

Rewards credit cards

Take rewards credit cards. Pick the right one, and it could deliver genuinely worthwhile cash back, points or miles. But have you got the right one?

If you have an average-sized or big family, for instance, there are several cash back cards that offers some highly-competitive cash back percentages on categories such as supermarket spending, department-store and gas-station purchases. Chances are, you spend a fortune in supermarkets and department stores. And you probably have to top up your gas tank regularly, what with you being an unpaid taxi driver for your kids.

If you're young, single, don't have a car, always eat out, and wouldn't be seen dead in a department store, then rewards in those categories would be a very poor pick for you.

Airline credit cards

The same applies with other sorts of plastic. Of course, few people with a morbid fear of flying have airline credit cards. That would be too silly. But quite a lot more probably have one when they don't need it. Unless you take to the air frequently and so earn lots of miles at premium rates, what's the point in earning 1-percent rewards on "other purchases" on an airline card when you could be earning 3 percent or more on a general one?

Of course, if you're a frequent flier, airline credit cards can be very rewarding. But you still have to ask yourself which card is best for you. For example, you can often trade off a higher annual fee for better rewards and privileges, including accessing lounges and cutting airport lines. There is no objective, empirically correct answer to these sorts of issues. If you're a Spartan sort who greets discomfort with steely stoicism, then no number of perks is going to see you part with a cent. But if you're the ultimate, self-indulgent diva -- or divus, if you're a male Latin scholar* -- then you might well be prepared to pay three-figure annual fees, even if you rarely fly, in order to make your trips more comfortable.

The point

The point of this article isn't to push you to do anything -- other than to think carefully when you choose your credit cards. You know yourself and your habits, and your goal should be to use that self-knowledge to pick the particular pieces of plastic that are going to make your life better. Fail to do that, and one day soon -- the way technology's moving -- you could end up with a credit card with a flexi crevice tool.

* If you are a male (or female) Latin scholar, please don't write to correct this almost-certainly poor usage.

Published 03/11/13 (Modified 11/20/13)


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