Confused by credit cards? Start here

So, you’re in the market for a new credit card. That’s great, but where do you start?

With literally billions of card offers being sent through the mail every year, the choices seem endless. In fact, you might even find them paralyzing.

But it’s easy to clear out the tangle of credit cards by narrowing down what’s essential and what you need. Here’s a primer to help you decide which card is right for you.

Get your credit score

You’ll want to determine your credit score first. If your score is low, options will be limited. On the other hand, if you have a score over 700, then the credit card world is your oyster. Nerdwallet will give you free access to your score if you establish an account with them.

Determine your needs

Figure out where you are on your financial journey. Credit card needs generally fall into three broad areas: building (or rebuilding) credit, lowering interest payments, or earning some type of reward.

Generally speaking, there isn’t much overlap on credit cards in these areas. That’s good because it makes your choice easier.

If you don’t have any credit or need to rebuild it, then you will probably get a card with a high annual percentage rate (APR).

Avoid applying for low APR or reward cards if your score is low. You may be denied, and that can make your credit number worse.

If you have good credit, then your next move is to analyze how you spend money.

Analyze your financial habits

First, ask yourself if you’ll pay off your card every month. If you don’t mind carrying a balance, it’s best to search for a card with the lowest interest rate. The best you’ll do in this area is between 13% and 24% APR.

If you pay off your credit card every month without fail, then the interest rate doesn’t matter, and it’s time to start looking at reward cards. The choices are seemingly endless.

Some cards offer cash back or frequent flyer miles. Others give points for gift cards and dining. The list of offers goes on and on.

So take a look at your spending habits and see where you would most likely use the reward offered on the card. But read the fine print on all offers. It’s no fun to build up a big pile of points just to have them expire. And some travel rewards come with so many restrictions, they become almost worthless.

If the thought of navigating reward offers makes you shake your head, consider avoiding a credit card altogether.

Since you pay off your credit card every month, you have the money management skills in place to simply keep a debit card. In addition, debit cards are safe, accepted everywhere, and there is no risk of missing a payment.

There’s a lot to learn about the credit card world, but these basics will get you started. But if you take the time to study it and make an honest financial assessment, you are bound to make a good decision!