If you're in the market for a new credit card, you may be overwhelmed by the hundreds of options available. There are seemingly endless varieties of cards offering rewards, no-interest periods and the chance to build credit, which can make it hard to settle on the right one for your wallet.
There's no one-size-fits-all credit card, so the best credit card for you may differ from your friend. However, there are some steps you can take to help narrow down your options when you're looking to get a new card.
Below, CNBC Select reviews three simple steps you can follow to choose the credit card that provides you with the most benefit.
Are you a small business owner? Check out how to choose a business credit card.
The first step is to check your credit score and credit report. There are numerous free resources available, such as CreditWise from Capital One and Discover Credit Scorecard, where you can check your credit score. Plus many of these services offer insight into factors that affect your credit and offer advice on how to improve it. You don't have to be a customer of Discover or Capital One to use these services.
Credit score ranges vary by credit scoring model (FICO or VantageScore), but creditors use FICO Scores in 90% of U.S. lending decisions, so we listed those ranges below.
FICO Score ranges
Once you know what range you fall in, you can use that information to fine-tune your credit card search. Consider cards that require credit equal to or less than yours. If you have good credit, consider cards that state good or fair credit requirements.
Even if your credit score falls within the good range that doesn't guarantee you'll be approved for a credit card requiring good credit. Card issuers look at more factors than just your credit score, including income and monthly housing payments.
Credit cards can be separated into three main types: rewards, 0% APR and building credit.
Below we list which consumer each type of credit card is best for.
If you have no debt and have already established good credit, rewards credit cards can help you offset the cost of purchases and pay for upcoming travel (by redeeming points or miles). Rewards cards come in all shapes and sizes with cards offering cash back, points or miles in common spending categories (travel, gas, groceries and dining out) that can be redeemed for statement credits, gift cards, airfare, hotels and more.
Depending on the rewards card you open, you may receive added perks. Here are some of our favorites:
Terms apply for all benefits.
Intro 0% APR
If you want to get out of debt or finance new purchases, a 0% APR credit card can be a good tool that offers no interest on purchases, balance transfers or both. The Citi Simplicity® Card offers an intro 0% APR for 21 months on balance transfers and intro 0% for 12 months on purchases (after 16.24% to 26.24% variable APR).
During the interest-free period, you can benefit from substantial savings versus carrying a balance on a high interest credit card, where a portion of your payment goes toward interest charges.
The best balance transfer credit cards offer no interest periods of at least a year, and some cards also offer hard-to-find $0 balance transfer fees. The Amex EveryDay® Credit Card, for example, offers an intro 0% APR for 15 months and no balance transfer fee on transfers made within the first 60 days from account opening (see rates and fees). (Read our Amex EveryDay® Credit Card review.)
If you have a large purchase coming up, consider putting it on an intro 0% APR card and benefit from no interest charges while you repay debt. Just make sure to pay off your balance before the intro period ends.
Take note that the best 0% APR credit cards typically require good or excellent credit.
If you don't have much credit history or have a less than stellar score (669 and lower), you should make building credit your top priority over rewards or special financing offers. A good credit score is key to unlocking the best interest rates and increasing approval odds for credit cards, mortgages and loans.
There are credit cards specially designed for building credit or for people with fair or average credit that can help you improve your score. Secured cards tend to be a popular choice for credit newbies and people with bad credit. Simply provide a security deposit, usually $200, and receive a credit limit equal to the deposit. Then you can use a secured card just like a traditional unsecured card.
The Discover it® Secured is a great choice in part because it also offers cash back: Earn 2% cash back at gas stations and restaurants (up to $1,000 in combined purchases each quarter, then 1%) and unlimited 1% cash back on all other purchases.
Learn more: How secured credit cards work
Once you've decided which type of credit card meets your needs, it's time to shop around for the best credit card offers. Consider bonus categories for rewards cards, length of intro period for 0% APR cards and credit tools for cards that help you build credit.
If you have trouble choosing one card, consider submitting a pre-qualification form online to see whether you may qualify. You can submit multiple pre-qualification requests without any damage to your credit score, since it involves a soft pull of your credit — which doesn't hurt your credit score. Be aware that pre-qualification isn't a guarantee you'll be approved for the card and submitting an application affects your credit score.
If you pre-qualify for one credit card and not another, that can be a good indication of which card to apply for.
Information about the Chase Sapphire Reserve®, Capital One® Venture® Rewards Credit Card, and Amex EveryDay® Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the cards prior to publication.
For rates and fees of the Amex EveryDay® Credit Card, click here.