In today’s world, credit cards are essential tools for building a credit history and keeping costs under control. With a credit card, you can purchase goods and services now and pay for them later, at an affordable monthly rate with favorable interest rates.
However, it is not as simple as opening any credit card that comes your way and start using it. There are many things you need to take into consideration before choosing a specific card. Given the numerous benefits, and pitfalls of various cards, here is an overview of how to choose a credit card wisely.
How to choose a credit card
Credit cards can be a great way to build your credit history and score, but if you’re not careful, they can also lead to high levels of debt. So, how do you choose the best credit card for your needs? Here are a few tips to get you started.
Check the card’s terms and conditions
The first thing to do when you’re looking for a credit card is to read through the terms and conditions of the different cards. Check if the card features the type of rewards program you’re looking for, along with any other features that may be important to you, such as travel insurance or a companion ticket.
Most credit card providers will also include information about the card’s interest rate, fees, and other details, so you can make sure you understand them completely before signing up.
When reviewing card terms, be sure to look out for any differences in rates and fees for different types of credit cards. You may find that some cards have better rates or lower fees than others, which can make a big difference in the long run.
Research the available rewards and benefits
Credit cards often allow you to earn points or miles for your purchases. While the cashback credit cards that offer a percentage of the amount spent are also available, nowadays the more common rewards are points and miles.
You need to decide which rewards program you want and then evaluate different credit card offers to see which one offers the best deal.
When comparing credit card rewards programs, be sure to read the fine print so you can see which types of purchases earn you points or miles and what the minimum threshold is for cashing in. You’ll also want to be sure to keep an eye on the expiration date on any points or miles you’ve earned.
Decide on an annual fee
Credit cards typically come with annual fees, which may affect your decision on which card to choose. Before signing up for a credit card, you should be sure that the benefits outweigh the annual fee and that you have the means to pay the annual fee in full.
If you have trouble paying off your balance in full each month, then a credit card with an annual fee might not be the best fit for you.
If you’re still unsure, you can try to find a credit card with no annual fee. However, credit cards with no annual fee often don’t come with as many benefits as those with an annual fee.
Make sure you understand the credit card’s APR
Another important thing to consider when choosing a credit card is the interest rate or APR. This is the amount of interest you will be charged on your credit card balance. The APR may be different depending on whether you are late paying a bill or you miss a payment entirely.
While most people pay their credit card bills on time and in full, it’s important to note that there are different types of APRs. If you are planning to carry a balance on your credit card, it is a good idea to look for a card with a low APR, which is usually around 1 or 2 percent. If you plan on paying your balance in full every month, you can choose a card with a higher APR.
Find out how much you’ll need to have for an initial deposit
Before you apply for a credit card, you’ll need to have an idea of how much you will need to put down as an initial deposit. This deposit is simply the amount of money you put down on the card when you sign up before you start to use it.
The initial deposit amount varies among credit card issuers. You may have to have a minimum credit score or income level to qualify for a credit card that requires an initial deposit.
You may also have to have a checking or savings account to which the credit card company can transfer the deposit amount. This is standard practice for most credit card issuers.
Compare rates for other cards before deciding
Before you decide on a credit card, make sure you also take a look at the rates that other credit cards offer. You may find that another credit card offers a lower rate or has fewer fees, which will end up saving you money in the long run.
Choosing a credit card is a big decision, so make sure you take the time to research your options to find the best fit. The sooner you choose a credit card, the sooner you can start enjoying the benefits of credit card ownership, like building a credit history or earning rewards on your purchases.
When you’re choosing a credit card, make sure you take the time to consider all of your options so you can pick the card that is best for your needs.
What is the best credit card in the Philippines?
There’s no credit card that works best for everyone. Some people prefer cards with low-interest rates, while others focus on rewards programs. The best way to choose a credit card is to understand your own spending habits and find a card that offers benefits that align with your lifestyle.
For example, if you often travel abroad, you’ll want a card that doesn’t charge foreign transaction fees. Or, if you’re trying to pay off debt, you might want a card with a 0% intro APR period.
Once you know what type of card you’re looking for, it’s time to compare your options. Start by looking at the biggest issuers in the Philippines: BDO, BPI, Citibank, HSBC, and Security Bank. Each bank offers a range of cards with different benefits, so take the time to compare your options and find the best fit.
When you’re ready to apply for a credit card, make sure you understand the pros and cons of using plastic. While credit cards offer convenience and can help you build your credit history, they can also lead to debt if you’re not careful. That’s why it’s important to only spend what you can afford to pay back and to always pay your bill in full each month.
With a little research, you can enjoy all the perks of using plastic without any anxiety.
5 Credit cards for beginners
If you’re new to credit cards, the thought of choosing one may seem daunting. But don’t worry, we’re here to help. We’ll recommend some of our favorite cards for beginners. So whether you’re just starting out or you’re looking for a new card, read on for advice and inspiration!
Citi Simplicity+ Card by UnionBank
- Start your journey to financial freedom. With no annual fees, late fees, and over-limit fees, you can keep your finances simple. Plus, get 10% back on interest charges when you pay at least the minimum due on or before the due date.
- Enjoy deals and discounts. Get exclusive deals and discounts when you use your Citi Simplicity+ Card. Enjoy your shopping experience even more!
- Perfect for beginners. This card is perfect for those who are just starting out on their financial journey. Keep your finances simple and enjoy great deals and discounts.
Interest Rates: 2%
Income Requirement: P21,000 (P15,000 for existing cardholders)
Eligibility requirements:
- Meet income requirements
- At least 21 years old
- Active mobile or phone number
- Valid GSIS, SSS, TIN, or UMID ID
Application to Citi Simplicity+ Card will not require you to have a deposit account with them.
BDO Viva Classic
- Get started with BDO Viva Classic. No principal membership fee or supplementary membership fee for the first year. Plus, the finance charge is only 2% so you can easily pay your dues without breaking the bank.
- Earn points while you spend. For every P1,000 you spend on your BDO Credit Card, you’ll earn two (2) Peso Points. That’s double the rewards. Use your points to get discounts, exclusive deals, and freebies from our partner websites.
- Perfect for beginners. BDO Viva Classic is perfect for those who are just starting out in the world of credit cards. With no principal membership fee and supplementary membership fee.
Interest Rates: 2%
Income Requirement: Annual income of at least P260,000
Eligibility requirements:
- At least 21 years old
- Filipino citizens (foreigners that are permanent residents for at least 2 years)
- Employed or self-employed for over 2 years
- Active contact number
AUB Easy/Classic MasterCard
- No interest in new purchases. If you’re looking for a credit card that doesn’t charge interest on new purchases, the AUB Easy or Classic Mastercard is an option. This is the best credit card to use if you want to pay off your balance in full each month.
- Choose exactly how much to pay. You can choose how much you want to pay each month. For example, if you don’t have enough money in your account for one month, simply make a smaller payment. No penalties or fees.
- Great discounts and deals. There are plenty of great discounts and deals from time to time. Also receive exclusive offers and promotions from AUB Credit Card partners.
Interest Rates: 2%
Income Requirement: P21,000
Eligibility requirements:
- Meet income requirements
- At least 21 years old
- Employed or self-employed for over a year
- Active contact number and email address
BPI Blue Mastercard
- Earn rewards points. Get Real Thrills every time you use your BPI Blue Mastercard. Earn 1 reward point for every Php35 spent. Redeem your points for exciting rewards like gift vouchers, shopping credits, airline miles, and more.
- Stretch your payment terms. Enjoy a wide variety of payment terms for up to 36 months. This gives you the flexibility to pay your bills over time without added interest charges.
- Have access to cash anytime. Worried about not having enough cash when you need it? With the Ready Cash feature, you can get up to 30% of your available credit limit in cash whenever you need it. This is perfect for emergencies or last-minute charging for groceries.
Interest Rates: 2%
Income Requirement: P21,000 to P25,000
Eligibility requirements:
- Meet income requirements
- At least 21 years old
- Major IDs acceptable: Driver’s License, Passport, Voter’s ID, SSS/GSIS ID, BIR/TIN ID, PRC ID, Postal ID, Company ID
- Proof of income or copy of credit card statement
Metrobank M Free Mastercard
- Partner establishments. – Get perks from partner establishments.
- 0% installment. Selected 0% installment program from a wide range of merchant establishments. Use the installment facility to pay big ticket items like appliances, gadgets, tuition, hospital bills, travel fare,s and accommodations at 3, 6, 9, 12, 18, and 24 monthly installment terms.
- Cash rush. Get instant cash when you need it via ATM.
Interest Rates: 2%
Income Requirement: P21,000
Eligibility requirements:
- Valid ID issued by the Philippine government
- Proof of income or employment
- At least 21 years old
By best credit card in the Philippines, we mean a card that offers the best terms and conditions for use in the Philippines. We will update this post on a regular basis to provide you with information on the best credit card in the Philippines.
However, we encourage you to do your own research to find the best credit card for your needs. There are many factors to consider when choosing a credit card, and what works best for one person may not be the best for another.
But by regularly updating this post, we hope to provide you with the information you need to make an informed decision about the best credit card for your needs.
