A credit card is a double-edged sword really. But times have changed and having one is almost  as essential as oxygen. Not only is it a back-up source of money in cases of emergency, but it is a staple way of doing transactions nowadays, particularly with the onslaught of online shopping.

Yet you must be cautious when deciding to get one and in choosing which credit card works best for you . First off you must feel confident enough that you have the sense of responsibility to not live within your means. Remember that a credit card is not a license to buy. Treating it that way will get you into deep financial trouble.

There are many options available in choosing a credit card. Often people tend to just look at which bank has the lowest rate. But there are other factors to consider to prevent you from paying fees that you actually avoid. Here are some deciding factors to help you find the credit card that will work for you.

1. Interest Rates

Probably the easiest way to compare is through this number. But keep in mind that there are the finer prints that you should really pay attention to. Usually you can be deceived by what seems to be the lowest rate in the market but fact is, it may only apply for the first few months.

Also look into the interest rates of cash advances should you think there is a possibility you may use this feature. This varies a lot and is usually higher than the interest on ordinary purchases. Some banks’ interest rates may also be variable, meaning it fluctuates depending on market conditions. Take time to read and ask questions on this element to be sure you are choosing the best card in the market.

2. Billing Cycle

The longer, the better as it provides you more time to be able to pay off your purchases with the card without interest rate, that is of course you paid the previous balance. Usually cards have a 30 day period, meaning should you be unable to pay purchases made on that month – they will incur an interest. You may be able to find companies that offer 40 to 45 days instead.

3. Annual Fees

Think on whether you really need a credit card in the first place. Because most cards attract annual fees whether you use them or not. If you plan on using it merely to make online shopping convenient, then consider other options for that such as Paypal. Compare the annual fees of various cards and weigh out whether that fee is worth the convenience and other perks that may be important for you. See the next tip.

4. Rewards Program

Most credit card companies offer attractive rewards program that may look too good to be true. So again read the fine print whether the rewards on offer are truly attainable for you. Rewards may be in terms of cash-back or points convertible to miles which suits someone who travels much.

There are also cards that are “specialised” and gives more points for specific type of purchases such as gasoline or at specific shops. If you feel that you will benefit from such type of cards then go ahead and sign up but be sure to read the terms and conditions first. Sometimes the points and rewards expire after a period of time and you’ll end up with no perks at all.

Annie is a finance expert blogging for Credit Card Finder, the registration-free platinum credit card comparison utility.