My First credit card - how do I decide

Parent Cafe
1

<p>Hi,</p>

<p>So I’m 19 and have never had a credit card of my own. Except, I think my credit score is probably pretty good because my mom added me to her credit card when I was 17 or 18 and she only keeps 1 or 2 cards and makes every payment on time and pays in full. I don’t know exactly what my score is, but I imagine it can’t be as bad as my peers. </p>

<p>Actually, the only sorta credit card I’ve had was one that I opened in poor judgement at a department store in order to get a 20% discount on something. I have not bought anything with it since. I just used it once for a suit that I needed for a meeting at my school.</p>

<p>Is this bad? If so, how bad?</p>

<p>Anyways, I found work a few days ago as a student assistant. I start in January when school re-starts. So now I want a credit card to work on my credit and be able to pay for things when a debit card is not practical or available. Is even this a good idea?</p>

<p>I’m not sure where to start looking for a credit card and what to look for. I know that a low rate is good but not much beyond that. And even so, what qualifies as a good interest rate today? And how do I find out which cards I qualify for? I’m home for the holidays and noticed 2 envelops of junk mail offering credit cards, both Chase bank, both addressed to my mom.</p>

<p>One was a Chase Freedom and the other was a Chase Slate card? Anyone heard of them? And do you think I’d qualify?</p>

<p>The specifics of the Chase Freedom card are as follows:</p>

<p>-0% until Oct 2010
-As low as 13% interest after that period
-No annual fee
-$50 Cash Back after your first purchase!
-3% bonus cash back offers in categories like gas, home improvement and department stores
-Full 1% Cash Back on every purchase - no spending tiers or caps on how much you can earn
-Up to an additional 20% cash back at select merchants when you shop online through Chase</p>

<p>This looks pretty sweet to me. But so does the Slate card, whose specs are as follows:</p>

<p>-0% for the first 12 months
-As low as 11% after that period
-No annual fee
-No annual fee
-Designed to simplify your finances
-Built to provide financial flexibility with Blueprint(SM)
-Buy with confidence with patented fraud protection
-Excellent credit required</p>

<p>*The bullet points after the first 3 are just copy and pastes of what’s on the website.</p>

<p>So what other numbers should I be looking at to compare cards? Does anyone know anything about these cards?</p>

2

<p>The key is NO ANNUAL FEE. THe interest rate doesn’t matter IF you are POSITIVE you will never have a balance and ALWAYS pay it off in full as soon as you receive the bill every month (think of it like a debit card–don’t spend it if you don’t have it & can’t afford to pay it off when the statement arrives).</p>

<p>It’s getting tougher for young people to get the cards, even if you’re sent the app you may not get it (like colleges sending apps & materials to tons of people they often later reject). It may be easiest to get a credit card with a local bank that you have had a longstanding account with (and/or your family does). I’ve had several Chase cards & they’re OK. I like getting cashback and have the first one you listed, among my many credit cards. I have no complaints about it. Some of the cards will only issue you cashback in $50 increments; if you don’t charge much, it can take a while to accummulate.</p>

3

<p>Good luck getting a card. It’s much harder to get a card now then it used to be. You have a much better chance at getting one from a company that has sent you an offer. Getting a credit card is similar to house hunting or the college search. At first you think it’s your choice and you are deciding which one looks best, but once you put in your application you realize that they have to approve you. Either of your two choices look fine to me.</p>

4

<p>huh, well at the very moment I don’t have an income. Do you think it will make things impossible for me?</p>

5

<p>Are you a full time student?</p>

6

<p>Yes i am.</p>

<p>10 char</p>

7

<p>

</p>

<p>This depends on if you were simply added as an “authorized user” (aka your name appears on the account and you are given a card to use) or if you were a “joint account holder” (aka you are legally resonsible for the debt placed on the card). Given that you may have been a minor at the time I suspect she may have only been able to add you as an authorized user, but you need to check this out. “Authorized users” no longer get credit score points for being on the account since simply being able to use the card does not establish that you pay the account off in time (afterall, as you say your mom was paying not you).</p>

<p>Without knowing your credit score it’s hard to say what you’d be qualified for so that would be the first step. However, keep in mind that with the previous credit crisis banks are much more carefull about who they give cards to.</p>

<p>Even if you you were a joint-account holder you would still have an extremely limited credit history (1 year and 1 card is very limited, especially if that card didn’t report to all 3 agencies). First find out what cards are available to you and then worry about what features you want.</p>

8

<p>You could apply for your own credit card through the same company your mother used to put you on her account. </p>

<p>I like American Express Blue Cash card, the only card of theirs that doesn’t charge an annual fee, I believe. It’s my main credit card. I only have two, that one and my business one which I use strictly for business expenses. I charge everything on my Amex so I get the cash back. I pay it off every month without fail. </p>

<p>The only drawback with the Amex is that occasionally, merchants will not accept it. Then I use my bank debit card. </p>

<p>Whatever card you start with, try not to carry a balance. Be strict with yourself! It’s a good habit to get into, to never buy things that you cannot afford to pay off in a single month.</p>

9

<p>Try your bank where you have your checking/savings accounts. Bank of America has (or used to have, not sure of current status) a program for college students for VISA cards with a small credit limit and a small annual fee.</p>

10

<p>Both of my kids just recently applied for the AMEX Blue card. They each had an AMEX on our account and well as their own VISA’s so getting a card was a bit easier for them, but the no annual fee AMEX is a nice card. There is also an AMEX Blue Cash with no annual fee. You can call AMEX and get approved on the phone; if you are not approved you can then try a Master Card or Visa with your current bank.</p>

<p>It is my understanding that getting credit cards is going to become much harder after the first of the year, which is why I encouraged my kids to apply for another card. They each have 2 cards in their name as well as one on our account for things we still pay for. One thing you need to remember to do is use your credit card at least twice a year to keep it active and to make sure your credit report looks nice. The purchase can be a burger from McDonald’s, just something to show you use your card and pay on time.</p>