8 Things Nobody Told Me About My First Credit Card

Everything I ever saw on TV growing up made it seem like having a credit card, or five, was the hardest thing you had to deal with in your adulthood. Characters are always freezing them in ice, cutting them up, or splitting purchases between multiple cards. While adulthood has brought on its own skew of problems (relationship drama, dieting, running on little-to-no sleep to balance a busy school-work-life schedule) the television didn’t get it all wrong.

Money is hard.

You grow up knowing this abstract concept of money and that one day you will have to pay bills and daily expenses – can anyone say student loans? – but I’m not sure anyone is adequately prepared to fight that battle. At least not me. So here is everything I wish I had known before getting my first credit card.

1. What exactly is this thing?

   Unlike my debit card that takes money directly out of my bank account, credit cards allow you to pay with money that isn’t actually yours yet. It’s a loan that you are required to pay back at the end of each month. So the plus side is that if you need to make a big purchase and your paycheck doesn’t come in for another two weeks, you don’t have to wait. The catch is that you need to make that minimum payment on time – or else.

2. No procrastinating.

   Unlike with every assignment I ever completed during school. Credit card payments are serious business. And the bank may not be as inclined to give you extra credit as your teacher was. A good trick to remember is to set a reminder on your phone. Write it on your calendar. Whatever method works best so that you don’t forget your payment deadline. Now, what if you’re late because you accidentally blew all your money? Well that brings us to number three.

3. Learn how the heck to budget.

   Often you can find classes on this. I even had a class on this my first year in college. I didn’t pay attention, but hey, I was only eighteen years old. (Who let 18-year-olds become adults anyway?) So, if you’re anything like me, you use your handy 2018 technological resources and download a budgeting template. At apruebame.com, we offer free budget templates. Go check them out. Of course, there are other options, and it’s likely that your mobile banking app already has a budgeting section, so pick what’s best for you and turn on your alerts to stay aware of your spending.

4.  There is such thing as a student credit card and no, it’s not a scam.

   Spread the word among the youth. My bank tried to sell me on this in my early college years and I thought, surely, they’re just trying to cheat me out of my money! They weren’t. They were just trying to sell me on a really sweet deal to help my credit score when I was young and didn’t have too many expenses so that eventually, I could get a home or a car one day. On that note…

5. What even is my credit score?

   Why did it matter if it was high or low? Well – turns out when you procrastinate – see number 1 – your credit score goes down. Just like in school. Late assignment. Bad grade. Sounds simple enough, yet nobody explained that to me. Basically, unless you’re going to pay off your entire new home at once, the people selling it to you want to know that you’re a trustworthy buyer and that you will be paying on time. 

6. Just because you shop there, doesn’t mean you need to open a credit card.

   This one is tricky. The department stores will try to lure you in with 20% off deals. Until you get roped into signing up for some credit card that you will never use, and you’re attached to too many stores at once and your wallet might explode from all the cards you’re trying to force in there. However, if you shop there all the time, and being a member of their program and signing up for the credit card actually will save you money in the long run, then I say go for it. But again, this brings me to the next point. 

7. Do your research!

   I know how this sounds, extra work after I already work and/or go to school all day? But there are so many different factors that go into choosing the right card and plan for you. Know what benefits different cards will give you. For example, rewards cards that offer cash back or even points that you can go towards travel, or secured cards that are easier to apply for based off a deposit upfront that can help you rebuild your credit. A good question to ask yourself is “How will I be using this credit card?” By knowing what you need, it will help point you in the direction of the right card. Another part of your homework will be to figure out what you’ll be charged for this card, including fees and interest rates. Your APR (annual percentage rate) will tell you how much interest you pay on outstanding balances over the course of the year. Sounds like a lot of work, but if you’re smart, the credit card system won’t be playing you. 

8. So how do I actually get one of these?

   You’ve done all your research. You brushed up on budgeting. You’re ready to apply for your credit card! But, how exactly? You can apply online through your bank, or through the specific card company’s website. The process is simple, but the trick is getting approved. Your credit becomes a big factor in this, but if it’s your first card, the biggest thing is they need to know that you have an income that will support the payments every month.

So, that’s it. This isn’t the end-all-be-all to everything you need to know about managing your finances and credit cards, but it should be enough to get you started. All I can say now is good luck!