Credit Cards

(MoneyWatch) 

What credit cards do I need?

by Jane Bryant Quinn

The best cards charge no annual fee and offer low interest rates to people who carry debt. My general advice is to own just two cards:

• A convenience card, for bills that you'll cover by the end of the month. Buy all perishables, such as restaurant meals and gasoline, with this card, as well as all other items you know you can pay for immediately.
• A low-interest card, for major purchases that will take several months to pay for. Charge only items that will last a long time, because those are the only ones worth paying interest for.

The trouble is that advice is too simple. Low-rate cards can turn into high-rate nightmares if you're just one day late in paying your bill. What matters nowadays is how you handle your card — do you keep its up-front, honeymoon terms, or will you fall into one of the costly traps that the banks lay for you?

Excerpted from Making the Most of Your Money Now by Jane Bryant Quinn

Copyright 1991, 1997, 2009, by Berrybrook Publishing, Inc. Reprinted by permission of Simon & Schuster, Inc

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