There are four main cardholder types in Australia according to finders.com.au’s credit card insights report 2014: emergency cardholders, online shoppers, reward hunters and proactive cardholders.

But the problem is, credit cards come with different annual fees, rewards points, complimentary insurances and interest rates, leaving many Australians in the dark as to what they actually need from their credit card in order to pair it to their lifestyle.

Choosing a credit card is an important decision, as the right card can help save you money – the wrong card might send you into a spiral of debt.

With only 23% of Australian cardholders being fully happy with their credit card, many of us need to rethink our credit card choices.

Luckily, here is a checklist to help ensure you remain one of those happy cardholders:

1. What are the pros and cons of the card?

There are different cards for different types of cardholders, and each type of card has it’s own pros and cons. For instance, balance transfer cards can have transferring fees; rewards cards may have higher interest rates, whereas low rate cards may have higher annual fees.

You first need to identify your spending habits, then you’ll know which cards you should consider.

From there it depends on what you’ll use the card for – finding your unique ‘groove’ will mean your credit card is an asset rather than a hassle.

2. How flexible is the card?

You should look at the options that the card offers, and make sure they suit how you plan to use the card.

Being aware of the introductory rates, annual fees and bonus points associated with your card, as well as how many interest-free days the card offers, is essential to knowing just how lenient – or strict – your spending and repayment flexibilities will be.

3. How costly are the features of the card?

When choosing a credit card, cardholders may look at the more obvious things they will be charged for, like annual fees and interest rates.

You also need to look at things such as earning rates on rewards points; cash advance fees, ATM withdrawal fees and bank statement fees.

Think of how you’re using your current credit card and then look at whether you’ll be charged for how you intend to use it.

Try and calculate a realistic monthly or yearly cost for the card to get a clear indication of whether a card is right for you. For example, rewards cards may be tempting option, however they’re also aimed at those who would spend at least $12,000 on a credit card per year.

This can be dangerous if you’re relatively new to credit cards, as the incentive to spend more in returns for rewards can ultimately leave you out of pocket.

Don’t feign convenience when it comes to choosing your card – only look for features you’ll actually use.

4. How will I be treated if I fall behind?

According to the Reserve Bank of Australia, the country’s national debt is sitting around $50 billion with almost $35 billion of which is accruing interest. Make sure you’re not contributing to this by paying off the balance in full each month.

Interest rates tend to be higher for rewards credit cards and platinum cards that have extra benefits.

Unfortunately, there will be situations where unexpected costs pop up, and one way to offset these costs is transfer your debt to a balance transfer card. There are many cards right now with no interest for up to 24 months.

Balance transfers are a great way to save on interest, provided you pay off the debt during the introductory period.

5. Are there any extra incentives?

The credit card market is becoming increasingly competitive, and providers are offering some great sign-up incentives for new cardholders.

If you’re looking at a rewards credit card, why not choose one that gives you bonus points on sign-up?

There are currently 54 credit cards on creditcardfinder.com.au that offer bonus rewards points on sign-up, some offering as many as 80,000 points.

Finding the right credit card doesn’t have to be a struggle. By simply comparing your options online, and keeping these points in mind, you can find the card that will help you get to where you want to be.

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