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In order to determine which credit card you need, you must first decide what you intend to use it for. Then decide what credit card features best serve those purposes. Of course, your payment history ultimately determines which credit cards you can apply for.

Use these categories as a guide.

Good/excellent payment history and zero account balance: If you intend to pay off your balance each month, you don’t need a low-APR offer because your account will not be subject to interest charge. What you should look for is an offer with low annual fee (or no annual fee) and longer grace period. You may also be interested in offers with rewards programs and low fees like late payment fee, cash advance fee, etc. One of the best offers in this category is the American Express Preferred Rewards Gold Card. This offer has an annual fee but it is waived for the first year and cardholders receive 10,000 bonus points after their first purchase plus tons of additional bonuses and services.

Good payment history but will carry a balance: In this case, you definitely need to consider low-interest offers among other features. One of those offers to consider is Citi Platinum Select MasterCard. It has a low interest rate for purchases and balance transfers, no annual fee, and an attractive 0% introductory rate on purchases and balance transfers for up to twelve months. It also provides other benefits including auto rental insurance, fraud protection services, etc.

Good payment history and wants cash-back Rewards: Cash-Back offers reward you with cash back incentives and rebate programs for purchases you make. However, you may end up paying higher interest and other fees. Cash back reward programs offer a solid value to those who pay off their balances every month and don’t require a low interest rate. Discover Motiva(SM) Card provides such value. Cardholders earn a 5% to 20% Cashback Bonus at top retailers through Discover’s exclusive online shopping site and up to a 1% Cashback Bonus on all other purchases. No yearly limit on bonus as long as the account is active within 36 months.

No credit/bad credit: If you are in this category, your best bet may be a secured/prepaid card, which requires cash deposit held in a separate account as collateral. Based on your payment history, the collateral requirement may be removed by the card issuer. Ultra VX Visa Card is one of the few in this category that offers a rewards program. Cardholders receive one point per dollar spent on purchases, which they can redeem for travel rewards with Southwest Airlines, American Airlines, jetBlue, Marriott, and more.

Student with limited payment history: This category is designed for students to help them build substantial payment history by the time they graduate. Many offers in this category include rewards programs for students. For example, Citi® mtvU(TM) Platinum Select® Visa® Card for College Students offers a unique rewards program, which allows students to earn 5 points per dollar they spend at restaurants, bookstores, record stores, and movie theaters as well as earn up to 2,000 points twice a year based on the cardholder’s GPA.

So, which credit card do you need? The answer depends on what you intend to use it for, what credit card features you want and your payment history. Once you have made your decision on these key factors, choosing the card that meets your needs becomes very easy.

Which Credit Card Do I Need?

Which Credit Card Do I Need?