Owning a credit card does have its pros and cons. Although there are several benefits, you have to check on your priority first. If you’ve never come across or struggled with money management, then applying for a card would not be an issue at all. If you are, however, having a hard time budgeting, then you might want to think things through. Several self-help articles can help you with the decision in terms of getting a card. Listed below are ten things to consider before applying for a credit card.
Choose which card suits you
Do understand that there are several credit card options to choose from. If it is your first time to apply for one, then you might have a difficult time getting the best card there is. Card offers for beginners usually have the primary benefits, which means that you’d have to work your way up in earning a good credit score before applying for the best package there is.
Having a Security Deposit Makes the Process Easier
Most banks usually offer first-timers credit cards with security deposits. If you’re struggling with your credit card application, try to apply for a secured credit card as it is specifically designed for those with low credit scores. The initial requirement in setting up a security deposit account is a minimum deposit, which will then serve as a basis for your credit limit.
Your First Card Can Make or Break Your Record
Congratulations! If you’ve already been approved, then that’s where your money management skills go in place. Take note of your expenses, make sure to track the times you’ve actually used the card, and your costs too. There may be times when we would get too overwhelmed and just use it all the way. Your first card can either make or break your record. Your credit score is on the line in terms of your card usage and the way you’d keep up with the dues. Use it wisely.
Take a Closer Look at the Fees
Credit cards have designated fees where they would state the monthly fees upfront. If you have follow up questions, do check their websites or ask a customer service rep to explain the charges once you’d start your account with them. Make sure to ask about the Annual Fees, the APR, the foreign transaction fees, and the late fees.
Fees are Unavoidable
We’ve mentioned about taking a closer look at the fees, once you’ve done so, keep in mind that these are unavoidable. Whether you like it or not, you would have to pay them as they are part of your dues. Some of these fees, however, can be avoided such as over-limit and late fees. By keeping track of your expenses, you would be able to avoid them all at once. In doing so, you will also have good credit reports.
You Can Avoid Interest
One of the misconceptions new card users usually have is about the interest rate. Keep in mind that these are avoidable if you’d pay on time. As long as you pay your bills in full, they won’t have accruals. Keep your paying record clean by paying your bills on a timely manner; that way, you can avoid paying for interest rates. Aside from avoiding these fees, you will also be able to build a good credit score.
These are just six things to consider when you’d get your first card. Practicing proper money management works wonders in having good credit records.