Looking for a way to build your credit? In some cases, opening and managing a credit card responsibly may help with that.
The key is how the card is used. When you’re applying for your first credit card, there are several important things to understand before you get started.
Below are five helpful points to keep in mind as you prepare to get your first credit card.
1. You May Need to Get a Secured Card
It’s common for first-time cardholders to start with a secured credit card. A secured credit card typically requires you to provide a refundable deposit upfront.
The card issuer holds this deposit and extends a credit limit that is often equal to, or sometimes slightly higher than, the deposit amount. Approval, limits, and terms depend on the card issuer and your application.
Secured cards are often used by people who are new to credit or working to rebuild credit after past issues.
2. Look for One Without an Annual Fee
Some credit cards charge an annual fee, which can range from around $35 to $200 or more, depending on the card.
There are credit cards available with no annual fee, and many first-time cardholders choose those options. If a card does have an annual fee, it’s worth understanding what benefits, if any, come with that cost before applying.
3. Don’t Expect to Get the Best One Right Away
When shopping for your first credit card, it’s helpful to keep expectations realistic. Your first card may not offer features like a 0% introductory interest rate, cash-back rewards, or premium perks.
That’s normal. Over time, as your credit history develops, you may qualify for cards with additional benefits, depending on eligibility and lender criteria.
4. Use It Regularly and Pay It Off Responsibly
One of the most important things to learn is how to use a credit card responsibly. Common best practices include:
- Using the card for regular purchases you would already make
- Paying the statement balance in full by the due date when possible
- Using the card issuer’s app or online account tools to monitor activity
- Avoiding interest charges whenever possible
- Keeping your credit utilization rate low, especially after larger purchases
Following these habits may help you manage your account more effectively, though results can vary.
5. Responsible Use May Help Your Credit Score
Using a credit card responsibly may help support your credit score, though improvements are not guaranteed and depend on multiple factors. Potential impacts can include:
- On-time payments contributing to a positive payment history, which is a significant factor in credit scoring
- Adding a credit account to your credit report, which may affect your overall credit profile
- Maintaining a low credit utilization rate, which can be viewed favorably by scoring models
Using a credit card irresponsibly—such as missing payments or carrying high balances—may have the opposite effect and could negatively impact your credit score.
Ready to Learn More About Getting Your First Credit Card?
Thinking about applying for your first credit card and learning how to manage it wisely? Understanding the basics can help you make more informed decisions as you get started.
When you’re ready, you can explore available card options and visit our site for more personal finance resources. For additional tips and guides, check out our blog.