5 Essential Rules For Managing Your First Credit Card Without Ruining Your Score

If it’s time to get your first credit card, whether you want a credit card for the convenience of having one in your wallet or because you need a cash injection on a temporary basis, you’ll want to make sure that you get the right one for you. Different people will have different needs when it comes to card features and benefits, so do your research before you sign up.

What card features should I look out for?

These days there are many card issuers that offer cash back, frequent flyer miles or hotel points among other benefits. Spend enough on your credit card and these rewards can really add up to something useful. Some are more generous than others so do your homework before you sign on the dotted line. If you are going to get a credit card anyway, you might as well make the card work for you!

On a more serious note you also need to look at what maintenance fees a card comes with, and most importantly of all the APR. APR stands for annual percentage rate and it’s best to think of this rate as the cost you will pay to have your credit card if you’re not planning to pay your balance off every month. The higher the APR the worse the deal! If you are still in full time study it’s worth checking out student cards, since these have special conditions like a much lower than average APR.

Are there any pitfalls to getting a credit card?

You should approach getting a credit card for the first time just like you would approach a loan. You need to be super responsible, and be sure that you can manage the credit line extended by your card provider.

Your credit score can be seriously affected if you are repeatedly late with payments or fail to make a monthly payment altogether, so treat your credit card as you would any other credit agreement. If you are late with payments you will have to pay the monthly interest on your balance as well as late payment fees. This can all add up quite quickly. By far the best way to use a credit card is to pay off your balance each month - but the reality is that it won’t always be possible. So, make sure you can afford the minimum monthly payment on your balance and pay on time!