Choosing a credit card is a big decision. You’ll be in a potentially long-term contract with a bank, and that credit card will likely play an important role in your daily life. You have to be able to choose the best credit card for your own needs.

Now let’s say you’ve already compared various banks and credit card companies, and you know the company you want to work with. As you’re preparing to apply for a credit card, you may find yourself facing yet another decision: which of the company’s credit cards should you apply for?

Several companies offer multiple credit card options where everything from interest rates and fees to rewards and credit limits vary. In this case let’s assume you’ve decided that you want a Commonwealth Bank credit card. You come across the following four options:

•    Commonwealth Bank Low Rate Credit Card
•    Commonwealth Bank Low Fee Credit Card
•    Commonwealth Bank Awards Card
•    Commonwealth Bank Gold Credit Card

Deciding What You Want

The first step in comparing credit cards from the same company is to see which card or cards offer the primary features you’re interested in. In this case we’ll make it easy. Let’s say you know you want a rewards card. That immediately rules out your first two options, and leaves you to choose between the awards card and the gold card.

To choose between the two, you would need to look at their differences. They both feature the same interest rates for purchases and balance transfers, so you would have to look at other features. Here are a few examples (with details given for the awards and gold card respectively):

•    Annual fees — $59 vs. $114
•    Awards points — Up to 50,000 per year vs. up to 100,000 per year
•    Interest free days — Up to 55 interest free days vs. no interest free days
•    Rewards — Standard rewards program vs. extra perks (like free travel insurance and commission-free travellers cheques)

This is again a somewhat easy decision for you. While you wouldn’t mind paying the larger annual fee if you were likely to use the extra travel-related perks, you don’t travel often. You also doubt that you would charge enough to earn close to 100,000 rewards points throughout a year anyway.

The Commonwealth Bank Awards Card makes more sense to you–the rewards are in line with your interests, you’ll pay a lower annual fee, and you’ll receive up to 55 interest free days to pay off your balances before accruing interest.

You can follow a similar process to compare multiple credit cards offered by any credit card company. Just start with your must-haves, and work on eliminating options from there until you’ve narrowed it down to the best card for you.