Credit can be a very positive thing when you want to buy something that is very expensive, but it is not the only time that you might need it. From time to time, you may have unexpected expenses that you need to deal with, and credit cards can help. There are things to consider when you start to apply for credit cards though. Remember, not all credit cards offer the same advantages.
Applying For Credit
When you decide to apply for your first line of credit, you should look at what you need and how you will use it. In some cases, the bank issuing the credit will ask and other times they won't. Credit cards are a revolving line of credit, so they don't care what you do with them as long as you pay the bill every month. You will need to document your income for the bank and undergo a credit check before they issue you any credit cards, and they will use the information to determine how much credit to extend to you.
Check the Rates
Before you accept a credit card from any bank or lender, check the rates that come with those cards. They are often extremely high on first cards, and it can make it hard to pay off completely. Banks that issue cards typically have lower rates than card companies or issuers that specialize in first-time cards or cards for people with poor credit. Some cards also require a membership fee that is applied to the balance yearly, so watch for that in the fee list. The difference can be an interest rate in the low teens to the upper twenties, so check the rates and fee carefully before you sign on the line for a credit card.
Responsible Spending
Because a credit card allows you the freedom to purchase something on the spot, it can be easy to overuse your cards. Remember that you will need to pay them off with interest to try and keep your spending to things that you need. Having the ability to use the card for something spur of the moment is nice, but you want to keep the balance on the card low enough that it is there when you need it. Start with things like gas purchases and small items that you can pay off in a month or two. That will ensure that you continue to grow your credit and have some credit available should an emergency arise.
