If you're like me, your mailbox is usually stuffed with things like bills...postcards selling some turbo-charged Internet service...maybe a few magazines...and, of course, credit card offers. It's the credit card offers that get you. They're pretty tempting, aren't they? Whether it's being pre-approved for $10,000, or the promise of earning free airline tickets, there's always something that lures us in. While you might get a few good offers every now and then, most should be sent right to the shredder. The trick is, knowing which ones should stay—and which ones should go. Be choosy Keep one thing in mind: if you have a couple of credit cards you're happy with, try not to apply for more cards. Each time you apply, it shows up on your credit report. And that can make you look credit hungry. It may also lower your credit score. When you do decide you need a new credit card—or you are applying for your first one—ask yourself: what kind of card do you want? You can get one with reward points. Or miles. Or even a card that helps you save. With so many cards out there, you don't have to jump at the first offer you get in the mail. Shop around. Learn the lingo You've probably noticed that credit card offers come with what looks like a lot of legal mumbo jumbo. But these are the terms and conditions of the credit card, and they explain what fees and finance charges you could pay when you use the card. Every card has different terms and conditions. To shop for the best deal, you need to know what the main terms mean. Here are some to look out for: Annual Percentage Rate (APR)—This is the yearly percentage rate charged when a balance is held on a credit card. This rate is applied each month that you carry a balance (the lower APR, the better). Annual Fee—Yearly fee associated with having the credit card. Unless you are getting rewards or miles, or something extra, you may want to look for a card without an annual fee. Grace Period—A period of time during which you are allowed to pay your credit card bill without being charged a finance and/or late fee. This period is usually 10-28 days. Introductory Rate (or Intro APR)—A temporary, lower annual percentage rate that is raised later. Make sure you know what the rate will go up to after the intro period is over. Other fees—Also check for the amount of the late payment and cash advance fees. Why wait? Activate Once you receive your new card in the mail, activate it right away. Then put it in your wallet or in a safe place. Otherwise, you may set the card down, forget about it, and it could end up in the wrong hands. As you use your card, keep an eye on your bill and the charges listed. Also, you should get your credit report on a regular basis to make sure no one else is using your account. That way, you stay in charge of your credit card.
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