Consider the annual percentage rate or APR. The APR measures the cost of credit on an annual basis and may be the easiest way to compare costs among credit cards. Usually, the lower the APR, the less you'll be charged for credit. The APR includes the interest rate and other costs, such as service charges or loan fees. If you expect to pay back less than the full amount you charge each month, you'll have to pay finance charges on the unpaid balance. In this case, choose a card with a low APR.
Examine the annual fees. Many companies charge an annual fee, no matter how much or little you use your card. If you intend to pay your credit card bills in full each month, you won't have to pay monthly finance charges, so a card with a low or no annual fee will be more important to you than one with a low APR.
Find out if a card offers a grace period. A grace period allows you to avoid finance charges if you pay your bill before its due date. Some cards have no grace period and begin to impose finance charges the day you charge an item. Other cards offer grace periods from 21 to 30 days. Cards with longer grace periods will save you money if you pay all of your charges each month.
Finally, check card offers to see if you will be charged a fee for paying your bill late or going over your assigned limit. These types of additional charges add to the total cost of using your credit card.
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