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New to Credit Cards? Here Are 7 Essential Tips to Get You Off to a Flying Start

Don’t be confused or scared of credit cards!

Essential Tips For Those New to Credit Cards

A credit card can be an incredibly useful financial tool, providing convenience, rewards, and the ability to build credit for big purchases in the future. However, for those new to credit cards, the options and terminology can be overwhelming. To help you navigate this exciting landscape, here are seven tips for people new to credit cards:

1. NEVER SPEND MORE THAN YOU CAN AFFORD.

You will see this in every credit card post and forum under the sun, but it’s truly the most important rule of this game—if you can’t afford to buy it with a debit card, don’t buy it with a credit card. Credit card debt is easy to fall into and extremely difficult to get out of, and if you start using your card beyond your means, it’s going to end badly. Credit cards can seem scary to many, but as long as you treat your credit card like it’s your debit card and pay your balance every month, you are setting yourself up for success!

2. Set up Autopay. Right Now.

Almost every bank has an autopay system that will automatically pay off your balance at the end of each statement period, meaning you will never pay interest on your cards. These systems are extremely easy to set up and take out the anxiety about remembering to pay your credit card bill. And no unpaid bill = no credit card debt.

3. Think about what type of rewards you want.

Credit cards will give you rewards for spending with them, typically in the form of either “cash-back” (% off all your purchases) or “points” (bank currency you can redeem for travel, gift cards, and more). Before figuring out which card(s) to get, consider which type of reward fits your lifestyle more, as the type of reward system you partake in will dramatically alter how much value you get out of your card. Make sure to learn more about the differences in cash back and points and which is right for you.

4. Be cautious of annual fees.

Many credit cards have an annual fee (AF), which is a fee that you pay every year in order to hold the card. These fees can range from $20 to over $1000! It’s important to make sure that whatever card you get, you’re getting more value out of the card than the annual fee—e.g. if the annual fee is $95, but I’m getting $150 worth of rewards or benefits, that card is worth it for me to get! The only caveat to this is if you’re getting a card for just a year to get the sign-on bonus (also known as “churning”), but that’s something that only advanced credit card pros should attempt.

5. Understand what makes up a credit score.

Knowing how to raise your credit means knowing what makes a credit score. At its simplest, there are 5 factors (ranked from most to least important): payment history (how frequently you’ve paid on time), amount owed (how much money you haven’t paid yet), length of credit history (how long you’ve had forms of credit), credit inquiries (how many new credit lines you’ve gotten), and number of accounts (how many types of credit you have). Raising your credit score can’t be done overnight, but if you understand what makes a credit score, you can come up with a plan for how to raise yours!

6. If you’re under 18 or have no credit history, ask your parents or someone you trust to make you an “authorized user” on their account.

Becoming authorized on another person’s account allows you to get your own version of their card (with your name on it). This allows you to start building your credit score before 99% of people, meaning that by the time you turn 18, you can already have a score of 750+. However, make sure that you trust the original cardholder, as if they don’t pay off the balance, it can negatively affect you!

7. If you have a low credit score, consider starting with a secured card.

“Secured” credit cards are essentially credit cards that you pay before you spend. This means that you have already put down the money that is being lent to you, and thus are less likely to go into debt. Secured cards typically have tough fees and stringent requirements, but allow people with lower credit scores to build their credit and eventually graduate to normal cards. This is a step that many people have to take (especially those with previous credit card debt), so don’t feel bad if these are the only cards you can qualify for!



I hope these tips have been helpful, and I look forward to you becoming a credit card pro in no time! While there is a lot to learn and many different paths to take, if you stick with it you’ll be redeeming pro credit card rewards in no time.