Picking a second credit card can be based on a personal decision or to expand credit experience. If you wish, you can get up to 2 to 4 credit card but these cards should be properly managed. Before picking the best second credit card, be mindful of the following :
Aim for Better Credit.
The level of experience you have determines your eligibility for the future opportunity of building credit. That is if you had positive credit experience from previous years, it will show on your credit score. Also, your credit score can be increased by the five factors of FICO when you add a credit card, including your credit utilization ratio to the mix. So as your payment history is increasing, accounting for 35% of your credit score, your utilization will at 30%.
The credit utilization compares the overall debt you owe to your a credit limit. Let say you have a single credit card with a $5,000 limit and you have a balance of $1000, with a credit utilization ratio of 20%. If you open another credit card with $10,000 limit. Your credit limit becomes $15,000 and your credit utilization becomes 6.6%. This can increase your credit and enable you to achieve your financial goals.
Are you Qualify for the Best Terms
The best second credit card can offer good terms and conditions but, most attractive ones that have the following features, are usually reserved for customers with wonderful credit:
No annual fee: You are required to pay an annual fee for some credit card in order to enjoy its benefits. But you will not be charged an annual fee.
Low or 0% APR: You can be given a period of no-interest spending for the first 12 months or more. So, you will be able to repay all your balance with no problem of increased debt.
Due date flexibility: You can be given the opportunity to request a monthly due that in line with your budget. To enable you to pay off your credit card bills.
Freebies: Some credit card offers monthly Uber credit of $15 and annual travel credit of $200 which can be used to for refreshments or entertainment on flights, like the American Express Platinum card.
So if you have low credit, you will hardly get a second card that has this type of terms. Therefore, endeavor to focus on increasing your score. Tips for Picking A Best Second Credit Card
Does the Card Serve Your Lifestyle?
You are to have a good reason why applying for a second credit card and stick to your budget to avoid unnecessary spending. So use your credit card wisely.
Although, some credit card gives the following rewards to their customers :
- Travel reward /miles amounting to free trips and hotel stays
- College saving fund
- Discount S with partnered retailers
- Quick access to ticketed events
- Purchase and protection against fraud, e.t.c.
Using your credit card wisely involves reducing your budget in a suitable way when you have too many expenses, alternatively, you can have it set based on your lifestyle and goals. So review your past spending, to know the aspects that cost you the most then compare this to the credit card that gives the right perks.
The lower your credit utilization ratio, the better your credit will be, and the best second credit card account may extremely improve your credit.