Never mind the bad press that credit cards get, but the truth is we can’t live without them. They provide a temporary relief when we’re short of cash and is definitely one of modern society’s more clever inventions. Cards represent the big C – convenience: when you need it and where you need it.

But it can also turn into a bad C – a cancer of debt that spreads in a sinister way and if you’re not careful, can suck the oxygen out of you.

Selecting the best credit card is like shopping for bread in the supermarket. You have numerous choices, each card having certain features that blend in with your spending habits. The idea is to have specific goals for a credit card. The average consumer these days has a motley of cards (that’s why their wallets are so thick) and because plastic is taken for granted these days, they lose track of the interest charges slapped on unpaid balances. Low interest rate cards have been around since Adam and Eve, in case you weren’t aware.

Before you decide on a card, you need to think of the reasons for having one, how you want to use it, what services you want other than instant credit, and what features of the card would suit your lifestyle best.

Selecting the Best Credit Card: Questions to Ask

What is it for? That’s the first question. How will it be used? That’s the second.

Some people use a credit card because they don’t like carrying cash around. For them it is much more efficient to use the card for groceries, gas, the dentist and the dry cleaner and the Chinese take out. They, however, make sure that the balance is paid in full when the bill arrives. If you fall into this category of cardholders who ALWAYS pay the balance in full, then the interest rate is not relevant. You may however want a card that will offer rewards or points in exchange for your continued patronage and excellent payment record.

For individuals who pay the full balance off every month, it might not be a bad idea to get a cash back card. Some credit card companies will issue dollar incrementals of credit for every X amount you spend using the card. Some credit cards offer credits of say $25.000 if you spend anywhere between $2,500 to $5,000 per month. This is a perfect arrangement for people who use their cards several times a day and every day of the week.

If you normally pay your balance in full but want to be able to maneuver at certain times by postponing full payments during periods when major expenses occur, you may select a card with a low interest rate. In Canada, for example, the standard interest rates range from 17% to as high as 22%. We use one that charges a 12% interest rate but we pay an annual fee and we are allowed to skip one month’s payment once during any 12-month period. It also provides for air miles.

If you’re the type who has two to three credit cards and like to play them against each other by transferring the balances from one card to another when payments are due, you’ll want a card that charges a very low interest rate for balance transfers specifically. This kind of card will charge you on the average 18% for purchases, 15% for cash advances but only 4% for balance transfers. Be careful, however, to read the fine print because when credit card companies offer a promotion of say 3.99% on balance transfers, the periods are usually for three to six months only. When the six months are up, the rates go back to 18%. As long as you stay on top of your “juggling” career, you should be okay.

Then again, there are credit cards that give you air miles or gift certificates for use in retail outlets. This is a neat little arrangement for people who travel a lot on business. When they accumulate enough air miles on their business credit cards, they can use the reward miles for family trips.

Now you see why it’s essential to ask yourself what purpose your credit card will serve. When you’ve decided that, it becomes much easier (and more manageable) to select the best credit card for you.

A debt that lingers for more than three months on a credit card is not too healthy for your financial situation. The reason is the interest rate. Why service a debt of $6,000 on your card if you can’t pay it off in the short term? Calculate how much you’re paying in interest alone and watch your eyes pop.

Selecting the Best Credit Card: What Color is Your Parachute?

Thanks to the wonderful spirit of innovation on the part of credit card companies, we have other choices when it comes to credit cards.

What color do you want? Green for basic, yellow for gold or silver for platinum? We have a dizzying garden variety of available credit at our finger tips.

One famous credit card company offers the basic membership which entitles you to spend amounts with specified limits depending on your credit standing and income. Basic memberships usually put a cap of say $2,000-$15,000 on the average. The gold memberships have a cap of $50,000.00 so you could literally walk into your car dealer’s office and leave with a top of the line fully loaded sedan. And then there’s – oh wow – platinum! It comes with unlimited credit, automatic insurance, best seat concert tickets, upgrades to first class when you’ve logged enough travel miles, and special deals on products that have not hit the market yet.

Credit card choices do not end with color, credit limits or rewards. Banks also offer other packages that just about take the spending profiles of all humans. One major Canadian bank for instance offers eight different credit cards: travel, cash rebates, auto club, GM, low-rate, golden select (no annual fee) Green (for security and convenience) and a US dollar card for those who cross the border often.

Depending on which card you choose, you get:

• Travel features (common carrier travel accident insurance, emergency travel assistance services, travel medical insurance, delayed and lost baggage insurance, travelers checks)
• Protection features (balance protection insurance, card assist, purchase security and extended warranty protection, and emergency cash advances)
• Auto Features (auto rental collision/loss damage insurance, Budget Rent-A-Car preferred rates, auto club).

While it can get difficult to make a choice, the convenience is there for the asking.

Us? We’re happy with a credit card that will give us a gift certificate to a book store twice a year!

A word of caution: when you receive your new credit card, note down the special 1-800 number provided at the back of the card. Should you misplace it, you won’t be scampering madly in the phone book to report a lost or stolen card.

Another word of caution: when your credit card comes, sign it immediately and activate it. You may be surprised to learn after eating out with your date that your card number is not registered with the central office because you forgot to activate it!