A credit card can play different roles in your financial life, depending on how you use it. You might use one for everyday spending, to build your credit history, or to help when unexpected costs arise.

Whatever your reason, the right card should support how you budget, along with any long-term goals you have. By establishing what you should look for when choosing a credit card, you can make a choice that suits you and your financial circumstances.

Why do you want a credit card?

When you pay with a credit card, you borrow from your provider. You control how much you repay each month (although there's a required minimum amount, which is set by the lender). If you clear your balance (the amount you owe) in full and on time, you avoid interest. If you carry part of your balance forward, the provider charges interest on that amount until you repay it.

Your reason for borrowing influences your credit card choice. Here are a few examples:

• Everyday spending: You could use it for things like the weekly food shopopens in a new tab or seasonal train tickets. Using a credit card for everyday purchases also adds a level of securityopens in a new tab. Like with a debit card, providers will often monitor for unusual activity, and many let you quickly freeze your card in the app if something looks off. Fraud protectionopens in a new tab services help safeguard your account.
• Emergencies: You might keep the card for sudden car repairs or unexpected household costs. This would give you a safety net without disrupting your entire budget. It can also give you time to plan how you'll repay the amount in a way that fits your finances, without needing to dip into savings.
• Building credit: You can also use the card for a small recurring payment (like a streaming service) and repay it reliably and in full. Over time, this pattern can improve the information on your credit file and strengthen your credit score. Keeping your balance low and avoiding missed payments also helps demonstrate reliability, which may open the door to more favourable credit options in the future. Remember that not managing your credit responsibly could harm your credit score.

If you're planning a larger purchase, look for a promotional 0% or an interest-free period. This can help you spread the cost without taking on extra debt, as long as you keep up with monthly payments. If you miss a payment, you'll start paying interest again.

Understanding the types of credit cards available

It helps to understand the different types available and how each one supports a specific need. When choosing a new credit card, consider the following types that are available in the UK:

Type of credit card	What it's designed for	When it could be useful	Limitations to consider
Type of credit card	Credit builder cards	What it's designed for	Helps improve or rebuild a credit history if used responsibly. Bear in mind that irresponsible use could harm your credit score.	When it could be useful	If you have a limited or lower credit score and want to show reliable repayment behaviour.	Limitations to consider	May have higher APRs, so carrying a balance can become expensive.
Type of credit card	Purchase cards	What it's designed for	Offers introductory rates on new purchases.	When it could be useful	When planning a larger spend and spreading the cost over a few months.	Limitations to consider	Introductory rates are temporary and increase after the offer ends. Missed payments may remove the promotional rate.
Type of credit card	Balance transfer cards	What it's designed for	Lets you move existing credit card debt to another provider.	When it could be useful	If you want to reduce interest on existing balances and focus on repaying what you owe.	Limitations to consider	Transfer fees may apply. Promotional rates end, so you need a plan to clear the balance in time or to be comfortable at the higher rate.
Type of credit card	Travel cards	What it's designed for	Designed for use abroad, sometimes with lower foreign transaction fees.	When it could be useful	When you're spending overseas and want predictable costs.	Limitations to consider	Cash withdrawals may incur fees. Some cards may not offer favourable exchange rates everywhere.
Type of credit card	Rewards or cashback cards	What it's designed for	Earns points, cashback or perks on spending.	When it could be useful	If you clear your balance monthly and want benefits for your everyday purchases.	Limitations to consider	Rewards rarely outweigh interest, so carrying a balance can make the card expensive. Some rewards have exclusions or caps.

What other borrowing options are there?

Credit cards aren't the only way to borrow, and depending on your situation, another option might suit you better.

• Personal loans can be useful for larger, planned purchases where you want fixed repayments over a set period.

• Overdrafts may help with short-term cash flow but can be expensive if used for long stretches.

• Buy Now, Pay Later (BNPL) schemes work in a similar way to a credit card, letting you borrow money now and pay it back later. They often come with introductory 0% offers but they offer less flexibility in how you pay back (normally set monthly payments like a personal loan).

Considering alternatives helps you decide whether a credit card genuinely meets your borrowing needs or if another type of credit would give you more stability or lower costs.

Understanding the cost of a credit card

It's important to understand the costs involved when choosing a credit card.

APR and interest

Every credit card charges interest unless you repay the full balance in full each month. The Annual Percentage Rate (APR) shows the yearly cost of borrowing, including interest and standard fees.

A higher APR makes carrying a balance more expensive, so you should always choose a card with a cost you can manage.

Promotional offers can reduce how much you pay in the early months. Always check when they end and what the rate increases to afterwards. Creating your own repayment planopens in a new tab helps you avoid paying more than you intend.

Fees to look out for when choosing a credit card

You might encounter fees depending on the card and how you use it:

• Annual fees: An annual fee only makes sense if the card features (like travel insurance or specific rewards) exceed that cost. Research the fee amount and plan out what you want to use your card for in advance.

• Late payment fees: You can take steps towards protecting yourself from accidental charges by setting up a Direct Debit for at least the minimum payment. Late payment fees could also potentially leave a negative mark on your credit file and damage your credit score, making it harder to borrow further down the line.

• Foreign transaction charges: If you travel, check whether your provider charges feesopens in a new tab before using your card abroad. You can find out how much you could be charged before you go away, so you can work out if it's worth using your card or an alternative payment method.

• Balance transfer fees: This is charged when you move existing debt from one card to another. It's usually a percentage of the amount transferred. While the move can save you interest, the fee adds to the total cost. Always check the rate and factor it into your repayment plan to make sure the transfer still benefits you.

• Cash advance fees: This allows you to withdraw money from your credit card, but it usually comes with a fee and a higher interest rate than regular purchases. Interest often starts accruing immediately, with no interest-free period. Using cash advances can quickly become expensive, so it's usually best to explore alternatives before taking out cash.

What to avoid when choosing a credit card

When selecting a credit card, it's just as important to know what to avoid as it is to know what to look for:

• High-interest rates: Avoid cards with interest rates you can't afford if you don't plan to pay off your balance in full each month.

• Annual fees that don't match your spending: Only pay a fee if the card's general features or rewards provide more value than the cost.

• Hidden or additional fees: Watch out for balance transfer fees, cash advance fees, late payment charges and foreign transaction fees.

• Applying without checking eligibility: Multiple applications in a short time can harm your credit score. Use a free eligibility checker first.

• Ignoring your long-term borrowing needs: Make sure the card suits your purpose (balance transfers, large purchases, travel) rather than choosing based on appearance or marketing.

Eligibility and how credit scores shape your options

It's important for you to know where you stand before you apply for a credit card. Checking your eligibilityopens in a new tab first means you'll know whether you'll be accepted for a card before you apply.

What lenders consider

Eligibility depends on a few key factors:

• Income: Can you comfortably make repayments?

• Credit history: How reliable are your past repayments?

• Existing financial commitments: Do you already have other credit or loans?

Understanding your credit score

Your credit score is a number made up of three or four digits that represents the health of your personal credit file. It indicates how reliable you are in terms of keeping up with repayments, based on your credit history.

• A good credit score can open doorsopens in a new tab to cards with lower APRs or longer introductory offers.

• A lower score or limited credit history might mean a credit-building cardopens in a new tab may be more suitable.

You can check your credit score for free through the main referencing agencies – Experianopens in a new tab, Equifaxopens in a new tab and TransUnionopens in a new tab – to understand how lenders might view your credit card application. As these referencing agencies each have their own criteria, it means that there is no 'magic number' to aim for. You might have a 'good' score with one agency and an 'excellent' one with another.

Hard vs soft searches

A full application triggers a hard search, which leaves a record on your credit file. Multiple hard searches in a short period can make lenders cautious. To avoid this, use a free eligibility checker like QuickCheckopens in a new tab first. These checker tools use a soft search to estimate the likelihood of being accepted, so it doesn't show up on your credit report. You can then more confidently apply if you're likely to get the green light.

How to decide whether a card suits your budget

Even if it's likely that you'll be accepted, you also need to be sure that the credit card fits into your financial life, giving you full control.

The card you could be eligible for might be appealing. It may well feature an attractive interest rate or no fees. But there are still some steps to take before applying.

1. Take a realistic look at your finances: Think about the repayments you can make. Can you afford them even if your income drops or an unexpected bill arrives?

2. Will a lower credit limit help?: If a lower limit means you're more likely to stay in control, choosing a credit card that protects against overspending is advisable. Look out for credit-building cards and tools that help you manage spending and avoid unaffordable debt.

3. Consider credit utilisation: Keeping the balance low relative to the limit demonstrates to lenders responsible usage and could help improve your credit score.

Top tools

• Digital management: A lot of card providers offer mobile appsopens in a new tab that allow you to check your balance, view transactions, and set alerts. These tools help you avoid missing your payments.

• Track your progress: Free tools like CreditWiseopens in a new tab can be used to get regular insights into your credit score and understand how consistent, on-time payments can strengthen your credit profile over time.

• Purchase protection: Section 75 of the Consumer Credit Actopens in a new tab offers valuable protection for purchases between £100 and £30,000. It means you can claim a refund if a retailer fails to deliver the goods or services paid for, if items are faulty, or if the company goes bust.

It's important to note that owning more than one card does not automatically damage your credit score. What matters is whether each card fits comfortably within your budget and whether you're managing them responsibly.

When you make payments on time and respect your limits, your balance will be easy to manage and your credit profile strengthened, regardless of the number of cards that you hold.

Choosing a card with confidence

Get a credit card that fits naturally into your financial life. When you understand its costs, know your eligibility, and recognise how it supports your goals, choosing a credit card can feel like you're adding a helpful tool to your day-to-day living.

Just a little preparation gives you the confidence to choose a card that supports your long-term financial well-being.

See if you're eligible for a Capital One card

Now that you know how to choose a credit card, you're in a good position to see what's out there. Take a look at the cards available at Capital One and use QuickCheckopens in a new tab to see if you're likely to be accepted.

Choosing a credit card FAQs

How many credit cards should I have?

There's no single number that's right for everyone. What matters most is whether you can manage each card responsibly. Owning multiple cards doesn't automatically harm your credit score but it's important to keep balances low and stay within your budget.

Some people find having one card for everyday spending and another for rewards or travel works well, while others prefer just one card to keep things simple.

How does a credit card affect my credit score?

A credit card can influence your credit score in several ways:

• Payment history: Paying on time improves your score, while missed payments can lower it.

• Credit utilisation: Keeping your balance low relative to your limit shows responsible use.

• Account age and mix: Longer-standing accounts and a mix of credit types can benefit your score.

• New applications: Each application triggers a hard credit check, which can temporarily lower your score if done frequently.

Using a credit card responsibly over time helps maintain or improve your credit profile. If used irresponsibly, it could hurt your credit score and make it harder to get credit in the future.

Can a credit card help me build (or rebuild) my credit?

Yes, it can help build or rebuild your creditopens in a new tab if used responsibly. By making small, manageable purchases and paying the balance in full and on time each month, you demonstrate reliability to lenders, which can strengthen your credit history and improve your score over time.

But it's important not to take on more credit than you can handle. Having multiple cards or carrying large balances can lead to missed payments and potential damage to your credit profile, if not handled responsibly.

What is considered a good credit score to get a credit card?

There isn't a single number that guarantees approval, as each lender uses slightly different criteria. Generally, a higher credit score improves your chances of being accepted and may give access to cards with lower interest rates or better features. Even if your score is lower, you may be eligible for credit-building cards designed to help you improve your credit over time.

Should I use an eligibility checker before applying?

Yes. A free eligibility checkeropens in a new tab (like QuickCheck) uses a soft credit search, which won't affect your credit score. It estimates the likelihood of being accepted for a card based on your current financial profile, helping you make an informed decision and avoid multiple unsuccessful applications. It can be a useful tool when choosing a credit card.

Does applying for multiple cards harm my credit score?

Applying for several credit cards in a short period can temporarily lower your credit score. Each full application triggers a hard credit check, which is recorded on your credit file. Lenders may view multiple recent applications as a higher risk. It's usually better to check eligibility first and apply only for cards you're likely to be accepted for.

Why do credit card interest rates vary?

Credit card interest rates, or APRs, can differ between cards and applicants because lenders consider factors like your credit score, credit history, income and overall financial profile.

Cards designed for people with limited or lower credit scores often have higher rates, while those for applicants with strong credit histories may offer lower APRs. Promotional rates, such as 0% on purchases or balance transfers, can also temporarily reduce interest.

What happens if I don't repay my credit card balance in full?

If you carry a balance past the payment due date, your provider will charge interest on the unpaid amount. The longer you carry a balance, the more interest accrues, which can make repayments more expensive over time. Additionally, missing minimum payments can lead to late fees and may negatively affect your credit score.

Can I use a credit card abroad?

Many cards can be used internationally, including for purchases and cash advances/ATM withdrawals. Be aware that some cards may charge foreign transaction fees, while others do not. Checking the terms of your card before travelling can help you avoid unexpected costs and make spending abroad more predictable.

Do credit cards offer rewards or cashback?

Some credit cards offer rewards such as cashback, points or travel features. These rewards are most valuable if you pay off your balance in full each month, as carrying a balance can cause interest charges to outweigh any rewards earned. When choosing a new credit card, always check how the rewards work, including any caps or exclusions.

What is the difference between a credit limit and available credit?

Your credit limit is the maximum amount a lender allows you to borrow on a credit card. Available credit is how much you have left to spend at any given time, after accounting for any current balance or pending transactions.

How often can I request a credit limit increase?

Lenders sometimes automatically increase your credit limitopens in a new tab if you've used your card responsibly, by making on-time payments and keeping balances manageable. You can also request a higher limit yourself, but this usually triggers a hard credit check, which is recorded on your credit file and can temporarily affect your score.

Most providers recommend waiting at least a few months between requests. Using your card responsibly over time increases the likelihood that any increase will be approved. You can also ask for a credit limit decrease at any time, if this is something that would help make your borrowing more manageable.