You may have a number of reasons you’re thinking about applying for your first credit card. Whatever your reasons may be, there are both pros and cons to taking out a card like this. Some people get along just fine without a credit card, but it can be a big help for others. In some cases, a credit card can be used to make big purchases and get protection.
If you’re thinking about applying for a credit card but you’re still a little unsure, read on for some things you should know:
You Might Not Be Accepted
Deciding you want a credit card doesn’t mean you’re going to get a credit card. Applying for a credit card does not mean you’ll be automatically accepted. You will have to have your credit checked over to be sure that you can handle a credit card. Whether you get accepted or not will totally depend on your track record with money throughout your life. You will be able to get a credit card if you really want one, but if you have bad credit, then you may need to go to a special lender and be willing to pay a much higher interest rate.
This is A Loan
Don’t be fooled into thinking that your credit card is free money. This is a loan, and anything you spend on it will need to be paid back. If you are already struggling with money, getting a credit card definitely isn’t the way to make your life easier. It’ll be great in the short term, but far more difficult in the long term.
You Need To Look For The Best Interest Rates
Don’t forget to look for the best interest rates when going for a credit card. This ensures you don’t end up paying through the nose when you pay back all of your purchases. You can find cards with zero percent interest rates, and most of them will have this as an incentive for the first year. After this point, you could pay anywhere from 10%-20% interest depending on your credit score and who you take your card out with.
This Card Will Be A Part Of Your Credit History
This card is going to become a part of your credit history, so make sure you use it wisely. If you abuse your card, it’ll show up in the future when you’re going for something bigger, like a mortgage. It’s a good idea to have direct debits set up so you never miss a payment, and try to stay well under your credit card limit.
You Could Affect Your Credit Score Both Positively And Negatively
A credit card could give your credit score a boost providing you spend sparingly and pay it back each month. If you fail to do this, then your credit score will suffer and this could hinder you in the future.
Ultimately, you know whether you can be trusted with a credit card or not. Don’t apply if you don’t think you’ll be able to control your spending!