Credit cards are evil, credit cards entice you to get into debt, and credit cards are just plain bad news.
This is the message a small, but very vocal, minority of rabid consumer advocates would have you believe.
Thankfully they’re all wrong, as credit cards are a very safe and efficient way of transacting commerce while offering aggressive consumer fraud protections.
Can credit cards be abused? Of course they can be abused, just like so many other consumer vices that have nothing to do with financial services.
But, if we were to treat adults like adults, we’d all conclude that credit cards are only as bad as the user.
Point being, consumers are going to continue to use credit cards regardless of how some would demonize them and their issuers, so we might as well optimize our usage as best we can.
Many Shapes and Sizes
There are well over 10,000 credit card issuers in the United States and shopping for the best credit card can be cumbersome and overwhelming, let alone practically impossible.
Thankfully, there are a small handful of websites that act as quasi credit card strip malls and allow consumers to consider the attributes of many credit cards and then compare them in a side by side environment for the purposes of allowing the consumer to choose the one that best fits our wants, needs, and restrictions.
Mint, CreditCardInsider, CreditSesame, and Bankrate (which owns CreditCards.com) all allow consumers to browse credit card offerings, compare offers, and then pick and choose the ones they like the best.
Normally, interest rates reign supreme when it comes to credit card attributes, but that’s not the end of things as it pertains to plastic.
Credit cards come in so many shapes and sizes, and interest rates are but one of the many key decision metrics we must consider when looking for the best fit for our wallets.
Interest rates are pretty predictable. They’re based almost solely on our credit scores, so if we’ve got great credit then we’re going to get a great interest rate.
Conversely, if we’ve got lousy credit we’re going to get a lousy interest rate, if we’re lucky. We might end up finding ourselves shut out of the credit card environment altogether if our credit is too bad.
Credit Card Shopping Protocol
Shopping for a credit card is not easy. You cannot shop for a credit card like you’d shop for an auto loan or a mortgage. The protocol is different.
Credit card issuers don’t act as brokers, offering you the best deal available at the time.
Auto dealers and mortgage lenders do, on the other hand, act as brokers and can shop credit reports and scores on behalf of the consumer to various lenders in search of the best deals currently available.
If you were to apply with one credit card issuer you’d be marrying them, and only them.
So, the deal you get isn’t necessarily the best deal available, but instead it’s the best deal they have to offer at the time. You’d be better off shopping for a credit card deal before you actually apply for the card.
Protecting Your Credit During the Process
This method might seem cumbersome, but it’s 100% worth your time and effort. Credit card inquiries are among the most damaging to your credit scores, so you want to avoid them at all costs.
That means applying for 10 credit cards to find the best one isn’t a good idea.
The aforementioned credit card sites allow you to compare offerings before you actually apply, thus saving you the impact of the inquiry and the potential credit score damage.
The Best Deals
The best thing about credit card shopping is that it’s 100% free. Credit card issuers are competing with each other like no other time in recent credit history.
The zero interest and rewards deals are the best they’ve been in the history of history, if that makes any sense.
If you’ve got good credit, you’ll be able to easily find zero interest offers extending 6 to 15 months with no balance transfer fee, if that’s your strategy.
Point being, don’t settle for any credit card offer because there is a line of credit card issuers waiting to pitch you their best deals.
John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a contributor for the National Foundation for Credit Counseling. He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry. The opinions expressed in his articles are his and not of Mint.com or Intuit. Follow John on Twitter.