Finding your first credit card can be confusing. Here are some things to think about when finding the right card.
July 25, 2021
Finding your first credit card can be daunting, but it's an essential experience for everyone to go through. If you aren't savvy about credit cards, you could potentially sign yourself up for a bad experience. I will avoid recommending credit cards that you should get as I do not understand your personal situation, but I will outline steps you should take to researching the right first card for yourself.
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Boy, I and everybody else in the world wish we could answer that. Truthfully, even credit card enthusiasts couldn't answer that question, because it depends on your own personal situation. Do you have credit history? Are you a student? Do you have income? Do you have existing relationships with banks? What types of rewards fit your spending habits the best?
There are many factors to take into account and I will outline the most important ones that you should focus on when considering whether a card is right for you.
Ok, I know I said the right credit card depends on many factors, but this is one that should be followed - get a no-fee card. In other words, get a credit card that doesn't have an annual fee. Why is this important? Well, you're getting your first credit card, so let's not get ahead of ourselves and try to go for the fee cards with tons of rewards and perks. You may regret getting a fee card as your first card, because it's a card you will likely keep forever. Also, most cards with annual fees and great perks won't approve you anyway, especially if you do not have any credit history. Build up history with other cards before you go gung-ho and swing for the top-tier cards.
Normally, I would say interest rates are irrelevant, because you should NEVER EVER be paying interest on credit card purchases. Always pay your credit card bill in full every month. Do not buy things with the intention of paying them off monthly with your credit card.
With that said, I understand that as someone getting their first card, and is potentially a college student, that you may need to exercise the interest rates with paying off purchases over time. If you aren't going to pay off your credit card in full every month, at least get a card with low interest rates. Unfortunately, by "low" I mean between 12% and 15%. Yes, credit cards make you pay up for not paying in full.
Again, please pay your credit card off every month. But I can't stop you from doing what you want, so I might as well lend a word of caution.
Believe or not, you can get decent rewards with starter credit cards. Check out my article about Beginner Student Credit Cards if you want to know some of the cards that I recommend for beginners/students. In general, standard rewards for starter credit cards are 1% cash, 1.5% cash back, cash back matching, intro bonuses, low interest rates, and rotating category 5% cash back. As someone looking for their first card, these are great rewards to start and it only gets better as you move up to higher tier cards.
If you are looking at credit cards that are offered by banks, make sure it is a bank that you trust. This is pretty self-explanatory, but if customers generally have trouble with banking services at a bank, the credit products will likely not provide any better of an experience. *cough* Wells Fargo *cough*
Overall, I would focus on these factors when finding a good first credit card. If the credit checks these boxes and you would feel comfortable owning it, then go for it. Good luck out there!
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