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How to Know You're Ready for a Credit Card

Jan 12, 2024

Having your own credit card can be an exciting prospect. With it, you can increase your financial freedom and build a strong credit history. As easy as it is to use, however, falling into a pit of credit card debt is even easier with improper use and poor habits. It’s important to approach your first credit card feeling ready for the responsibility.

So, how do you know if you’re ready? Here are a few questions to ask yourself before getting your first credit card.

Do you stick to your budget and pay bills on time?

If you are financially responsible in other areas of your life, then a credit card should be a breeze. If you regularly have money left over each month, are usually able to resist impulse purchases and always pay your bills on time, then you’re probably ready for a credit card.

If you’re not in charge of any bills, think about how well you meet deadlines for assignments, take care of a pet or perform in similar areas of responsibility.

Do you have a saving habit?

Before you spring for a credit card, you should at least have an emergency fund set aside. Ideally, you should have three to six months’ worth of living expenses saved up, but even a small fund of $1,000 can give you the backup you need to avoid credit card debt.

If you don’t have a saving habit alongside your credit card, then you may find it harder to pay off debt when emergency expenses crop up.

Do you understand how interest works?

A credit card is a type of loan. If you don’t pay off your balance each month, you’ll be charged more based on the amount you owe and the rate of your card. (And once those attractive introductory rates expire, you could be looking at a rate of 18% or higher.)

Thankfully, most cards give you around 30 days to pay back your purchases from the last billing cycle before charging interest. For example, if you spend $100 with your credit card and have an APR (Annual Percentage Rate) of 10%, you’ll actually owe $110 if you don’t pay off your balance within a month.

The Benefits of Credit Cards

If you’ve answered “yes” to some or all of the above questions, you might feel ready to start. The downsides to credit cards can be scary, but those can be mitigated with responsible use – and the benefits are numerous.

- They’re easy to use and accepted almost everywhere.

- You can build a good credit history by using them wisely.

- Many offer Purchase Protection, which means you may be reimbursed or receive a replacement for a damaged or stolen item within a certain time frame.

- You’re protected by a Zero Liability Policy, so it’s easier to get your money back if there are fraudulent charges.

- Some cards come with rewards points, which earn you cash or similar rewards just for using your card.

If you’re still nervous about getting your first credit card, don’t worry. There are many options to help you start carefully. You could…

- Apply for a student credit card, which comes with benefits targeted specifically at young adults.

- Ask a guardian to make you an authorized user, making someone else responsible for the monthly payments.

- Ask for a card with a lower limit and only use it for gas, groceries and emergencies until you feel more confident.

- Apply for a secured credit card, which requires you to put down a deposit and doesn’t allow you to spend more than that.

Honda FCU has two great credit card options, both with a low rate and appealing benefits. Learn more about our cards here.


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