Credit Cards For All Weathers

When it comes to credit cards, it's rare to find a card that really has that `wow' factor.

This article was first sent to Fools as an email in our 'Afternoon' series.

However, this April Abbey took the credit card market by storm with the launch of its Zero credit card, offering 0% on both balance transfers and purchases for six months, together with no fees on balance transfers, cash withdrawals and transactions abroad.

I, too was seduced by the tasty terms offered by Abbey, and the Zero card sitting in my wallet has helped me to save a packet in overseas charges this year.

Now, round two of Abbey's credit card assault has seen the bank launch yet another innovative product, dubbed `the credit card to help with the essentials'.

Abbey's new card offers 3% cashback for six months on all petrol and grocery spend, together with 0% on balance transfers for nine months (a 3% fee applies), and purchases for three months.

Blending traditional balance transfers with a rewards program, this jack-of-all-trades credit card could provide the solution for those looking to combine a card that cuts the costs of your existing debts, while maximising your everyday spending power.

On closer inspection however, there are some better deals available if you know where to look.

Budgeting those balance transfers

It's important to highlight the differences between Abbey's new card and the Zero credit card.

For example, unlike the Zero card, you have to pay a 3% fee on all balance transfers made. With the new 0% promotional period only lasting nine months, you could get a longer deal for a similar fee.

The best deal at the moment comes in the form of the Virgin Money MasterCard, which offers 0% on balance transfers for a whopping 16 months. Choosing this card will get you seven extra interest-free months of credit, plus a slightly lower balance transfer fee (well, 0.02% less - but every penny counts!).

However, by far the niftiest thing about the Virgin credit card is you can also use it to make cash transfers into your bank account, which also qualify under the 0% BT deal. This will allow you to pay off other types of expensive debt such as your overdraft or loan.

More prime for purchases

When it comes to new purchases, although the Abbey credit card offers 3 months interest-free on purchases, several alternatives will cut the cost of your credit, for longer.

Barclaycard Breathe provides the best deal on purchases at the moment, giving you 0% on new purchases for 12 months. Or, for a more well-rounded card, the Halifax All in One MasterCard and Bank of Scotland All in One MasterCard both provide 0% on both balance transfers and purchases for 10 months, ensuring you won't fall into the trap of negative payment hierarchy during the 0% period.

Cashback is king

If, however, you sit on the other side of the financial fence and pay your credit card balance in full each month, it's probably rewards which interest you most.

The important thing to remember about Abbey's cashback deal is that it only lasts 6 months, and while this is not to be sneered at, there are better offers out there.

The most generous cashback scheme comes in the form of the American Express Platinum Cashback card, which offers 5% cashback on all spend for the first three months - perfect in time for that Christmas shopping, plus up to 1.5% cashback thereafter.

Egg Money also gives you a flat 1% cashback on all purchases made. Both cards are worth considering if you clear your balance each month. It's money for nothing after all!

Alternatively, the Shell MasterCard gives you back 3% cashback on all Shell Fuel spend, together with 1% on all other purchases. Admittedly, cashback earned can only be used on future Shell purchases, but unlike the Abbey card, you won't lose these perks after six months.

Of course, if you are looking for a well rounded card, then Abbey may very well provide the solution. But as we always say at the Fool, shop around, and consider what you'll most use your credit card for. After all, Abbey may be the card of convenience, but in my opinion, it's not always the card of choice.