Samsung TL500

By far the largest segment of the digital camera market, point-and-shoot models are compact, easy to use, and typically take great pictures with minimal effort. You simply press the shutter button, and the camera automatically adjusts shutter speed, aperture, focus, and light sensitivity to capture a clear image with optimal color. Unlike Digital SLRs which offer larger image sensors, more manual control and interchangeable lenses, point-and-shoot cameras can often slip into a pocket, and are typically less expensive.

Deciding to buy a point-and-shoot camera is the simple part, but with hundreds of models with varying price points and feature sets to choose from, selecting the best one is no easy feat. Follow these rules to find the right compact digital camera.

Rule #1: There's More to a Photo Than Megapixels
"That camera looks great, how many megapixels does it have?" This is a question I've heard time and time again, but the truth is that more megapixels don't make for better photos. A decade ago, when cameras were making the jump from 2-3 megapixels to 4-5, it was a matter of discussion. But now, with point-and-shoots starting in the 10-megapixel range and climbing as high as 16 megapixels, it's a moot point. Very few of us are going to make prints large enough to take advantage of all those extra pixels.

Sensor size is much more important. Putting too many pixels on the smaller image sensors (which are generally 1/2.3" when measured diagonally) found in compact cameras, can actually hurt camera a camera's low-light shooting performance. These sensors are much smaller than those found in D-SLRs, which can make color gradations less smooth, and make it more difficult to create a shallow depth of field. But the advantage is the ability to put lenses with longer zoom factors in compact packages—you can find a camera with a 20x lens that can fit into your shirt pocket like the Canon SX260 HS, something that no D-SLR can match.

Some compact cameras have larger image sensors, in the 1/1.7" range, but these are usually aimed at enthusiasts and are priced accordingly. If top-notch image quality in a compact package is an absolute need, no matter the cost, consider one of these larger-sensor compacts like our high-end Editors' Choice, the Canon PowerShot S100. These cameras can't match the long zoom range of compacts with smaller sensors, but generally perform better in low light. You won't be able to blur the background like you can with a D-SLR unless you're focusing on an object only a few inches from the lens, but larger sensors generally produce images with a bit more depth than their smaller counterparts.

Rule #2: Pay Attention to Lens Focal Length, Not Just Zoom Factor
The zoom range of a camera is often highlighted in marketing material, but that "x" number, which expresses how far a camera's lens reaches, doesn't tell you the full story. The focal length range, which is generally expressed as a 35mm equivalent value, tells you more about the field of view that the camera can cover. For example, two cameras may both have 5x lenses, but if one covers 24-120mm, like the Canon PowerShot Elph 110 HS, and the other 28-140m, like the Nikon Coolpix AW100, the former will be better suited for shooting in tight spaces while the latter will have a longer telephoto reach. Better point-and-shoots start at around 28mm these days, which is a nice wide angle that is well suited for shooting in tight spaces. Budget cameras often start around 35mm, which is less useful for family snapshots, as it will be harder to frame photos with multiple people in smaller spaces.

Rule #3: Weigh Size Versus Features
You can get a truly capable point-and-shoot camera that's downright tiny, but it will likely lack a long zoom lens and other advanced features, to keep it slim. And it might come with harder-to-manipulate controls, especially if you have larger hands (smaller cameras mean smaller buttons and dials). If you can, get your hands on a camera before you buy, it's the best way to see which models feel best.

If you're happy with a moderately long zoom and you don't need, say, an articulating LCD, an ultracompact model like our midrange Editors' Choice, the 8x Canon PowerShot Elph 310 HS is a very capable camera that takes beautiful photos and will slide into even a tight pocket. Cameras that add more advanced functionality, like the Wi-Fi capable Samsung WB150F or the ruggedized Olympus Tough TG-310 will generally be a little bit bigger. And if you want a camera with an extremely long zoom range, like the 35x-equipped Canon PowerShot SX40 HS, you'll be nearing the size of a small D-SLR.

Rule #4: When it Comes to LCDs, Display Resolution is as Important as Size
Because you'll be using your camera's rear LCD to frame and review photos and videos, its quality is paramount. You should look for a camera with at least a 2.5-inch display, although 3 inches is preferable. Camera LCDs are generally measured in dots, with larger values representing sharper displays. A 230k-dot display is just passable in terms of sharpness for a standard 3-inch screen. You'll be able to see fine detail in your shots and enjoy better outdoor performance with a camera with a bright 460k or 921k LCD. Larger point-and-shoots, like the Panasonic Lumix DMC-FZ150, sometimes include articulating screens, which can rotate a full 360 degrees, allowing you to shoot from more interesting angles.

You can also get a point-and-shoot with a touch-screen interface. These models allow you to adjust camera settings and fire the shutter by tapping the rear screen, eliminating traditional physical control buttons. The main advantage is the ability to put a larger screen on the rear of the camera—the Canon PowerShot 510 HS has a 3.2-inch display. If you're the type who wants to fiddle with manual controls, a touch-screen camera might not be a good choice, as it takes longer to change settings when compared to button-based commands. But if you want to happily shoot in automatic mode, the touch interface could be an appealing choice.

Rule #5: Good Low-Light Performance Lessens the Need for Flash
We test the high-ISO performance of every camera that comes through the PCMag Labs. Basically, ISO is a measure of the camera's sensitivity to light. The higher the setting, the more light the sensor collects. A camera that is set to ISO 100 will capture the same amount of light with a one-second exposure as it will with a half-second exposure at ISO 200. Getting a camera that performs well at higher ISO settings will make it possible to snap blur-free photos in lower light. Almost every compact camera has a built-in flash, but there are certain situations where it doesn't make sense to use it. Because the surface area of the flash is much smaller than that of a professional light, it's better to let the camera use it to fill in shadows rather than provide the entire illumination for a scene.

As you increase the ISO, image noise increases as well—and too much noise makes for grainy, blotchy photos. A camera that performs better at high ISO values—you should look for one that keeps noise under 1.5 percent at ISO 800—can use a lower powered flash to grab sharp photos, without creating a washed-out look. It's important to check reviews to see how cameras actually perform at these higher settings, as one camera may produce much better images at ISO 1600 than another. A few point and shoots are really masters of low light—the Olympus XZ-1 has an extremely fast f/1.8-2.5 lens that can snap clean images through ISO 1600.

Rule #6: Image Stabilization is a Must
Optical image stabilization, which compensates for the shakiness of your hands when taking a photo, is a must in a point-and-shoot camera, unless you plan on shooting on a tripod all the time. Nowadays, almost every midrange and high-end point-and-shoot includes this feature, but if you're trying to find a camera in the $100 range, it's something you should definitely check for. Our roundup of the best budget cameras is a good place to start.

Rule #7: Go for HD Video
Almost every point-and-shoot on the market will capture video, but you should set your sights on one that can record in HD. Don't get hung up on full 1080p resolution, a compact that records in 720p is more than capable of capturing video destined for online sharing. Most models that record HD video also feature a micro or mini HDMI output port to the camera connect to your HDTV for hi-def image and video playback; if you have a large screen HDTV, this is where you might benefit from the higher video resolution.

As far as recording the video, you'll want to check and see if the camera can zoom while recording, but be aware that the sound of the lens zooming is often picked up by the camera's mic. Some larger point-and-shoots will have an external mic port, making them better suited for more serious video work.

Rule #8: Get Last Year's Camera for Less
Point-and-shoot models are generally refreshed yearly, and improvements are usually incremental rather than dramatic. You can save a bundle by going for a year-old model, without sacrificing much in terms of functionality. For example, our Editors' Choice for high-end compacts was the Canon PowerShot S95 until its successor, the S100, came to market and stole its crown. If you're able to live without the features new to the S100, you can find the S95 for sale at a full $100 off its original $400 sticker price. Likewise, the predecessor to our Editors' Choice superzoom, the Nikon Coolpix S9100, a $330 camera, is the Coolpix S8100. It doesn't feature quite as long a zoom lens, but can be found online for as little as $130—which is an excellent value in our book.

Finally, before you settle on your perfect shooter, read our recent point-and-shoot camera reviews, and check out The 10 Best Digital Cameras for the top point-and-shoot cameras we've tested.