Most of us have a somewhat confused attitude towards credit cards. On the one hand they're a quite convenient method of payment and if you manage the repayments responsibly offer a handy alternative to paper money. At the same time we're all instinctively wary of them. Everyone's heard horror stories of livelihoods consumed by credit card debt and a large number of us have felt a, hopefully fleeting, taste of how owing money can very rapidly spiral out of control with one or two missed payments and one or two silly purchases. "I'll pay with my card" has developed into a turn of phrase touched with a frisson of danger.
The process of going for a credit card has thus matured into, for many, quite an important venture. We all wish to know that we're not getting ripped off and, as far as possible, we'd all like to believe that, unlike all the other saps, we're saving money. In truth of course it's probably best to forget the idea that there is one credit card that towers over the others and represents the ultimate deal for all. No such holy grail exists and in fact there's really no such thing as a one-size-fits-all credit card. This isn't to say that there are no good deals out there; it's just that it's more a case of selecting the right card for your specific needs.
The onus is also on you to manage your credit cards effectively and make them work to your financial benefit. So the first question is: Do you currently have credit card debts? If you do then your priority should be to find a card with a good balance transfer rate - there are plenty out there with a 0% balance transfer offer. When you transfer your credit card balance you are effectively paying off your current debts on one card using a new card so that you now owe money to the new card. If that new card has a special introductory cheap rate for balance transfers then your initial, more expensive, card will be debt free and you'll be paying less interest, potentially 0%, on your new card. The trick to paying off this debt without incurring any additional financial load is to ensure that your monthly repayments are sufficient to cover the debt before your introductory cycle matures.
The most important rule to remember is not to purchase anything with your new balance transfer card; if a card permits a genuinely good balance transfer rate then the chances are it won't offer a similarly attractive purchase rate. If you still want to spend on a credit card then you'd be well advised to get an extra card for purchases and focus solely on paying off your balance transfer debts with the first card. If you're doing this, it's clearly in your interests to find a card with a good introductory deal on purchases. At the time of writing the NatWest credit card was offering the longest 0% interest on balance transfers for 13 months 0% interest on purchases for 3 months with a rate of 13.9% thereafter thereby buying you more time to pay the card off. HSBC is offering the longest 0% on purchases deal of 12 months and then a 15.9% typical APR and even the supermarkets are muscling in with reasonable offers with the Asda 0% credit cards being the strongest.
Living in the information age, we are blessed with a number of web sites similar to The Motley Fool, which assist you to compare many different credit cards and acquire one that best meets your needs. Always make a note on the calendar or your electronic diary so that you may switch as close to the end of your introductory period as is allowed to keep away from falling back into the trap and paying through the nose.
So which card is best for balance transfers? If you're hunting for the longest 0% period then Virgin steams in front with an impressive 15 month interest free period on balance transfers, they do however charge a relatively high 2.98% fee. Perhaps the best overall deals at the moments are offered by Natwest credit cards and RBS credit cards who both offer 0% for 13 months and a lower 2% fee. Other decent 0% credit cards worth investigating are offered by Asda Finance (0% PA for 9 months, 2.5% fee), Capital One Platinum (0% PA until 1st August 2008, 1.7% fee) and Mint (0% until 1st Oct 2008 (2.5% fee).