How to choose a credit card in the Philippines

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People often ask ”what is the best credit card”. There is no simple answer to this as every person uses their credit card differently, one card might be perfect for a shopaholic and not so good for an avid traveller. The way to approach this is to find out what credit card is perfect for YOU and YOUR needs. Money Monster has put together some points every Filipino should consider in order to help them find the best credit card for them but before you compare credit cards, make sure you know the basics….

  • Having a credit card means you don’t need to pay your bill in full every month, which can be useful but remember anything unpaid will incur interest charges.
  • If you miss a payment to your credit card provider or go over your credit limit you will be charged a fee, usually 500 pesos + a percentage of the outstanding balance
  • Credit cards can be great, they offer protection on purchases, can be used in most places meaning you don’t need to carry cash and they enable you to borrow in advance. However, credit cards are only good for financially responsible people. Not used correctly and your credit card could cost you a lot of your hard earned income in late penalties and over credit penalties.
  • A credit card enables you to make purchases without the money being taken from your bank account right away. Instead you will receive either by email or mail a credit card statement every month stating how much you owe, when it needs to be paid and what is the minimum payment you can make.

There are many different types of credit cards to compare.

will you be using your card for a lot of retail shopping in malls? If so you will want a card with good rewards, points and cash back specifically for shopping, some banks offer credit cards up to x 2 rewards for shopping. Click here to see the best Shopping credit cards. 

Perhaps you like to travel? If so you would want a card that offers the most miles and travel rewards, meaning every time you make a purchase using your card you will earn air miles that you can then later redeem for a free or discounted flight. You also want to watch to consider if you will be using your credit card overseas or not? If you do, you will want to make sure you have a card that offers low transaction fees on overseas spending.

How do i plan on paying my credit card bill every month?

Something that is often overlooked is how do you plan on paying for your credit card? You need to be honest with yourself and consider if you can definitely make full payment each and every month. If you think you might not be able to make full payment every month then make sure you find credit cards with low interest rates. This will  help keep your interest payments low and affordable. Credit cards are usually designed differently, a card with great rewards and cashback offers might be perfect for people who make full payment of their bill every month, but not so good for people who like to make monthly minimum payments as these types of cards can have higher interest rates.

0% balance transfer cards

These cards are great for people who currently have a credit card and are being charged a high monthly interest rate due to an outstanding balance. For people in this situation transferring to a 0% or low interest balance transfer card can be very beneficial as they will move their outstanding balance to the new credit card company and not pay any interest (or a low interest rate) for several months, saving them a lot of money.

 

 

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