Compass tips:
Basic compasses: These are good, inexpensive choices for beginning adventurers, day hikers and backpackers who stick to trails. They have all the essential components but lack some bonus features, such as declination adjustment or a mirror.
Advanced compasses: These are full-featured models with many extras (e.g., mirror, magnifier) that improve accuracy and make navigation easier. They are well worth the added cost if you regularly travel off-trail or deep into the back country.
Accessory compasses: The type found on key rings or watches, or small round compasses with no base plate. They accurately point toward magnetic north, but are designed more for fun and quick reference than serious navigation.
Ferrous metal can distort a compass reading, so be sure to take bearings away from your car, camera or other metallic objects. Magnetic interference can easily alter a compass reading enough to mislead you. So, if you are plotting bearings at a picnic table, check to see if your compass is being exposed to metal bolts or brackets that may affect its accuracy. Electrical fields (a running car engine, for example) can also throw off the accuracy of a compass (true for both floating-needle and digital compasses).
Be careful where you store a compass. For example, do not store a compass on top of a stereo speaker, which is equipped with a powerful magnet, or a place exposed to strong electric current. Do not place it in your pocket next to your cell phone. Over time, such exposure could demagnetize the needle. A compass responds to the dominant magnetic fields in its vicinity; you want it to be the earth's.
Be aware of regional magnetic zones. Compasses not only need to be held level to "swing" properly, they need to be appropriate for the latitude. In general, the earth has 5 different magnetic "dip" zones. These areas can cause a compass needle to drag against the housing, affecting the accuracy of a bearing. Fortunately, the contiguous United States all falls within the same magnetic dip zone.
Note: Most compasses correct for dip by slightly unbalancing the needle. This works fine as long as you stay near the same latitude. If you visit a place with a much different latitude (say, the Southern Hemisphere), your compass may not work properly. Some compasses are specially designed to work anywhere on the planet.