Credit cards are basically a revolving line of credit capped at a certain level which is set by either you or the card issuer. When you make a purchase you are in effect borrowing money from the card issuer. At the end of the month you can pay the amount of any purchases you’ve made or pay part and be charged interest on the outstanding amount which the balance of such is carried over to the next month along with any extra purchases.

Although, most cards are different and charge interest at different points of the process, so be sure to know your card , how it works and what the charges are.

If you’ve had a credit card for some period of time it is well worthwhile to regularly review the interest rates and charges. You may find in many cases that rates, fees or charges may have increased and that there are more attractive rates on offer. It also worth contacting your current provider to ensure you are on the best rates available.

Some words of wisdom are - Don’t let credit manage you, you manage the credit. Always spend within your means.

Choosing a credit card
If you expect to always pay your monthly bill in full, and other features such as frequent flyer points don’t interest you, your best choice may be a no annual fee credit card and a credit card that offers a longer interest free period.

If you sometimes carry over a balance from month to month, you may be more interested in a low interest rate credit card.

If you expect to use your card to get cash advances, you’ll want to look for a card that carries a lower interest rate and lower fees on cash advances.

Also check that the card is readily acceptable overseas, if you’re a traveler.

Check the security policies and what happens if your card is stolen or lost and used without your permission, is there insurance on offer or policies to protect you.

It is worth investigating the fees that are charged as some charge for what others don’t. For example annual fees, cash advance fee, late payment fee, over the credit limit fee, set up fee just to name some.

Some cards offer a start up or honeymoon interest rate, although what might be more important is the everyday rate on your new credit card.

The Credit Card Alternative
If you are looking for the convenience of and global acceptance of the Visa card along with the ability to purchase online or pay over the phone for example but are not interested in the credit facilities a Visa Debit Card may be a solution for you. This type of debit card is usually available through banks and Credit Unions.

Applying for a credit card
Many credit card issuers accept online credit card applications with approval times ranging from instant to 48hrs.

General requirements for a credit card application are:

* 18 years or older
* an Australian resident
* some have a minimum earning requirement which can range between $15,000 to $25,000 a year

They will probably also want information on:

* What you earn (wages, salary and other) and what you spend
* Details of who you work for - including name, phone number and address of your employer.
* And if you’ve been with that employer less than two years you may need the details of your previous employer. Details of any existing loans, such as personal loans and other personal debts
* Information about credit or store cards including credit limits and current balances
* The current value of your assets including your home, bank accounts, investment properties, shares and vehicles.
* Along with personal ID, ie licence, other cards, bank statements, utility statements etc.

Who’s who of credit cards
The major credit card services around the globe are probably very familiar names. They are Visa, American Express(AMEX), Master Card & Diners Club. Applying for a credit card is handled through various issuers including the banks, credit & building societies and credit providers like Virgin Money, Aussie and even Coles Myer.

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credit cards