APR (Annual Percentage Rate):

          Perhaps one of the most significant things you should look for from your credit card is a good APR or Annual Percentage Rate. This is the rate of interest that you will be charged when you use your credit card for purchases. I say purchases because you may be charged a different APR for direct cash withdrawals. As a general guideline the APR on your credit card should be close to  or below the current APR of the industry. You can usually find this information by checking the business section of a major newspaper. If you have a hard time finding it in the newspaper, try calling your local bank or your credit card company, they may be willing to provide it at no fee. Another way is to search the internet for the terms "Current Industry APR" or something along those lines. Depending on which search engine you use, you may have to try different terms; but "APR" or "Annual Percentage Rate" should be included in your search.
          Now why is the APR so important? The answer is quite simple. The lower your APR, the less interest you be charged for using your credit card. If you pay your credit card bill in full each month this isn't as important. But you should always try to get the lowest APR possible, because you never know when you are going to need it. Those who are considered by credit card companies as a credit risk may be asked to pay a high APR. So don't be surprised if your first credit card has a high APR. I don't mean that it will be or that it should be high, but it may be. This is specially true if you have a lot of negative credit information on your credit record. The better your credit, the lower your APR will probably be.

          Membership & Other Fees:

          Some credit card companies charge a annual membership fee, if you get one that doesn't charge one then you are in good shape. I don't mean you have good credit, you just have a good start, something less to worry about. If you are charged a fee, it must be reasonable in comparison to the level of credit you are receiving in return. A $75.00 annual fee may be considered excessive for a $200.00 credit limit. But a $75.00 annual fee for a $2000.00 credit limit is more reasonable. This is not to say that you should expect to pay a high annual fee for a high credit limit. But that if you have to pay a fee, make sure it is reasonable.
          If you can get a card with no fee, the all the better. But don't be surprised if you have to pay one on your first credit card. Also pay close attention to any other fees that may be associated with your card, such as a late payment fee, a cash advance fee, etc. This is specially true if you have a low credit limit or owe a large amount on your credit card. Because these fees may run up what you owe them and may even cause you to go over your limit, which will then cause the company to charge you an over-the-limit fee. Pay close attention to your credit limit, what you charge on your card, and how much credit you have available. Carelessness or lack of attention can get you in a lot of credit trouble.

          Payment Grace Period:

          Next we come to the payment grace period; pay close attention to this number, because you will need to know how long you have before you will need to pay the minimum payment on your credit card. Between 20-30 days is currently a reasonable number, and most cards I've come across fall in somewhere in this category. But above all make sure you have a grace period, some cards may require that you pay for all the charges on your card in full each month. So unless you are absolutely sure that you can afford to pay for your charges in full each month, don't get one of these cards. If you already have one, you should consider getting one that gives you a grace period; even if you don't think you need it, you may find it useful from time to time.

          Minimum Payment:

          I've already mentioned minimum payment so I should discuss the topic. The minimum payment is another important factor you should consider when getting a credit card. This is the lowest payment you must make each month in order to satisfy your current credit debt. This number should vary in relation to how much you owe on the card, unless you must pay for the charges in full each month. The minimum payment is usually calculated by the credit card company using a percentage they have somehow decided is a good minimum payment percentage.
          The lower the percentage, the lower your minimum payment will be. Some applications don't mention this percentage, so you may need to call the credit card company in order to obtain it. If you already have a credit card and you owe money on it, then you can calculate your minimum payment to a certain degree of accuracy. First make sure your minimum payment doesn't include any late charges and so forth, normally it shouldn't. If you have another old bill ('s) from this card then you will be able to verify you calculation.
          To get your minimum payment percentage, divide your minimum payment by your current balance. You should get a decimal number. Next move the decimal point two spaces to the right. This number is a relatively close calculation to your minimum payment percentage. Do this again for at least another credit card bill, the answers should be very close to each other. Now you can use this number in order to shop around for a credit card that may offer you a lower minimum payment or in order to calculate your minimum payment if you want to know what it would be if your balance reached a specific number. For ean xample on how to calculate this, look right below this paragraph.

Example 1. Calculating minimum payment percentage

Current balance: $545.00
Minimum payment: $12.00
Minimum payment percentage: unknown

Minimum Payment

$12.00

--------------------

or

Balance

$545.00

Decimal

Example 2. Using your minimum payment decimal or percentage

          Let's say that you expect you balance to increase by $200.00, or from $545.00 to $745.00, and you want to know approximately how much money you will need to have available to pay your minimum payment next month. It's quite simple to find this out, multiply your percentage by your expected balance.

Expected balance: $745.00
Minimum payment: unknown
Minimum payment percentage or decimal: 2.20183% or 0.0220183

A. Using the Percentage

Balance x Percentage = $745.00 x 2.20183% = $16.403643 or $16.00 - $17.00

B. Using the Decimal

Balance x Decimal = $745.00 x 0.0220183 = $16.403643 or $16.00 - $17.00

          You  get the same answer regardless of whether you use the percentage or the decimal. But with the decimal you don't have to use the percentage button on your calculator. This is specially useful if your calculator doesn't have a percentage button.

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