by Lily S

Created on: March 08, 2009   Last Updated: March 31, 2009

Despite the Credit Crunch, there remains an astonishing choice of credit cards on the market to suit every pocket and circumstance. Here are some tips on how to choose the best credit card for you:

1. Ask yourself whether you really need a credit card in the first place. In the UK debit cards are accepted everywhere. You can even use them to pay UK websites online (when chip-and-pin was introduced, all debit cards switched to the Visa network). It's not only those who can't get credit who use debit cards - they are used by that section of the population that doesn't like to borrow and likes to live within their means.

2. Do you carry a balance on your credit card or do you pay your card off in full each month? If you carry a balance, you need to pay attention to the interest charged (the APR). Use a card comparison site to search for credit cards with the lowest interest rates. Some credit cards will offer an interest rate as low as 6.8% for balance transfers, and will maintain this rate for as long as the balance exists on the card. When you transfer to such a card, you need to be careful that you don't make purchases on it, as these will incur a much higher rate of interest.

Many people are attracted to cards that offer a 0% deal for a short period when a balance transfer is made. But to deter deter "rate-tarts", the lenders now charge a fee to make a balance transfer, and sometimes these fees are so steep it's not worth going ahead. Always check what the fees are before you proceed.

3. If you pay off your credit card in full each month, the perks that come with the card gain importance. Many cards offer cashback ranging from 0.5% to 1% cashback on the value of your purchases. Some cards have teamed up with other reward schemes - Sainsbury's credit card offers Nectar points, and Nectar also has it's own credit card (Nectar points can be spent in Sainsbury's supermarkets, and in Argos stores, as well as on a number of other goods and services). Tesco provides similar benefits for their credit card users with their Clubcard program. Some cards such as Lloyds TSB's offer airmiles - if you travel a lot, these can bring substantial savings. Use card comparison sites to compare credit cards and find the ones with the best benefits.

Credit cards also offer insurance on all your purchases, and unlike debit cards, are accepted outside the country and are thus useful for those who travel a lot but don't wish to carry travellers cheques or foreign currency.

4. Check what

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