Make a Credit Card for the First Time

Make a Credit Card for the First Time

Make a Credit Card for the First Time: When you get your first credit card, one of two things can happen can launch your journey to financial independence. It good credit, you’ll be able to access low annual percentage rates on mortgages, auto loans, and better credit cards with perks or no annual fees. You could pay higher fees and higher interest rates or get loans declined.

Get Your First Credit Card

Getting your first credit card may be as simple as submitting the credit card application online and waiting a few seconds for a decision. But for most first-time cardholders, applying isn’t this simple because most cards require you to have an established credit history before you can qualify.

You may need a credit card designed for first-time cardholders:

    • Student Credit Cards: These cards have low credit lines but may offer small cashback rewards on some purchases. When you turn 18 or enroll in college you can expect to see offers aimed at college students.
    • Secured Credit Cards: Unless you’re a college student, I recommend a secured credit card as your first. You have to make a security deposit to fund your credit line. The point is for your issuer to report your positive payment history to the credit bureaus, increasing your credit score.
    • Unsecured, Starter Credit Cards: Expect high annual fees, and even some come with monthly fees if you get one of these cards. You’ll also have a limited credit limit and a high-interest rate.
    • Credit Card with Co-Signer: If you know someone with excellent credit, he or she could co-sign on your application. Your co-signer would become responsible if you defaulted on the card.
    • Gas Station or Store Credit Card: Some gas station chains and retailers, like Target, offer store credit cards that don’t require an established history.

Make a Credit Card for the First Time

Whether you’ve chosen a Discover, Capital One, or a secured credit card from Sky Blue, you can apply for your card online. If you’ve chosen a bank-issued Visa, you could apply in-person at a local branch if you’d prefer.

Either way, you’ll need to share your Social Security number, your annual income, and your personal contact information. The issuer will run your credit score. The resulting hard inquiry could hurt your credit score if you apply for several cards within a few months.

Before you apply for make a credit card, check score yourself. Make sure your score meets the account’s minimum requirement. When you check your own score, the resulting soft inquiry cannot hurt your credit. You can check your score:

    • At annualcreditreport.com: This site, run by the three major credit bureaus. Lets you download a copy of each of your credit reports once a year. (Through April 2021 you can get a free credit score every week.)
    • With a free app: Credit Karma and Credit Sesame show you a free credit score your VantageScore without showing your actual credit reports. These apps provide free credit monitoring. You’ll see lots of ads that you should ignore unless a card provides just what you need.
    • With a paid service: TransUnion and Experian offer paid credit monitoring services which also provide identity theft protection.

Following this habit can help you build good credit and keep it for the rest of your life, providing a less expensive financial product when you’re dealing with other “firsts” like your first house, your first new car, or your first small business loan.

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