When it comes to picking a credit card, you have so many options that it can feel overwhelming. You can get credit cards from banks, stores, gas stations; nearly anywhere and for anything. 

Whether you are getting your very first credit card or looking to get a new one with better benefits, the choices are wide and very different. It’s important to pick the right one, as each time you open a new credit card, it impacts your credit score. You should only have a few credit cards open and not open a bunch all at the same time, as this can heavily change your credit score. We’ll lay out some of the benefits and disadvantages of different credit card types.
 

First, Look at Interest Rates
 

A major deciding factor when opening any credit card needs to be the interest rate. Credit card debt is a heavy burden to bear once you open one. High interest rates can make it feel impossible to get rid of credit card debt. The higher the interest rate, the more risk you put yourself in.

Picking a credit card with a lower interest rate is an overall smart idea. Often, credit cards through financial institutions have lower interest rates than retail credit cards. Before signing up for any card, shop around and look at different interest rates and make sure the one you want is reasonable.
 

Are There Annual Fees?
 

Something that can sneak in under the radar are annual fees for credit cards. It’s not part of the promotion for the card, nor mentioned by the cashier when asked if you want to open their credit card, but annual fees are part of credit cards. Often, cards with better benefits come with an annual fee.

Annual fees aren’t necessarily a bad thing, but you need to make sure you are getting your money’s worth from the credit card. If the credit card has a $99 yearly fee, you better be getting at least $100 in benefits, if not more. When signing up for a card, be sure to ask and research if it has an annual fee. Sometimes they will try to confuse you by saying things like “no annual fee for the first year,” but get a hard answer if the card has an annual fee. If it does, analyze the benefits of the card and make sure you’ll get your money’s worth.

Both financial institutions and retail stores have credit cards with annual fees, but retail stores' benefits might not be enough to cover the fee. 
 

What are the Card’s Benefits?
 

A credit card without benefits is not a credit card worth your time. Benefits are a key part of picking which credit card to have in your wallet and when to use it. The better the benefits, the more you should want the credit card.

Some common credit card benefits are:

• Air travel miles
• Points to redeem on vacations
• Cash back
• Reward points to redeem on a variety of items
• Discounts on purchases

Retail credit cards typically have benefits that relate directly to the store you got it from. For example, a gas station credit card gives cash back or discounts on purchasing gas from them. Similarly, Target’s credit card gives you 5% off on purchases at Target, but nowhere else. Typically, retail credit cards have great benefits solely for their store.

Financial institution credit cards are a bit more varied. If you travel a lot, you’ll likely want to get a credit card that gives miles for flights. If you enjoy getting cash back, pick a credit card with a high cash back percentage. You should try and pick a card that matches your lifestyle and preferences. 
 

Picking a Card: Retail or Traditional
 

The three biggest impacts on choosing a card is: interest, annual fees, and card benefits. When looking at credit cards, these are what you need to examine. 

Now, if you plan on shopping at a store a ton, make big purchases there, and the benefits will actually make the card worthwhile, go ahead and get that specific store's credit card. You will probably get a lot of value out of it. Just be careful of annual fees and a higher interest rate and pay it off monthly.

For everyone else who doesn’t have a store they shop at a ton, getting a card through a financial institution is a better approach. You’ll earn benefits wherever you use the card, rather than being restricted to a single store, and the benefits can better match your lifestyle.

If you are looking for a new credit card, Pioneer’s Platinum VISA Credit Card needs to be one you look at. With no annual fees, reasonable interest rates, and great benefits, it checks all the boxes. Plus, our Rewards system is robust and flexible. Want to use your points to pay for airfare? You can do that! Looking to redeem it for a hotel stay? Enjoy that continental breakfast. Want to redeem it for gift cards to your favorite restaurants or stores? Get a dessert with that steak. Open one today and stay earning those points quickly!

Open a VISA Credit Card