Thinking about getting a credit card. What, if any, are the precautions of posessing a credit card?

Answer 1

Create a budget and stick to it. I know some people that carry a check book register with them. When they make credit card purchases, they enter them in their register. Then there are no surprises at the end of the month when your statement comes rolling in.

Set a limit that you can live with. After you have a card for a short time and keep it in good standing, the credit card company will begin to give you increases in your spending limit. If you are uncomfortable with the higher limits, give them a call and ask them to lower your limit.

Never carry a balance if you can help it (and you should be able to help it with a good budget in place). The interest on these cards is anything from 8% to 24% and can keep you in debt for decades. If you do get some debt on the card, adjust your budget and get it paid off as soon as you can.

A good budget is something that you can live with (and within). Build a savings plan into your budget for rainy days. Even if you are only putting $10-$20 a paycheck away, it is better than nothing. The point is you get used to saving money. Then when you get a raise, put at least half of the raise directly into your savings.

Good Luck!

Answer 2

While all of these are good answers, I would say, if you have already established good credit (car, cell phone), stay away from credit cards completely. While you may have good intentions as to paying them back, there is a reason credit card debt is so high in this country. If you've never had one before, I would suggest getting a credit card that spends money you already have. How it works is you open a 'savings acct' with the credit card company, for example, $200. That $200 in turn becomes your credit card spending limit. You still have to pay back your purchase amounts every month, and it accrues interest on the balance- however, if you decided to close your credit card account, you get your $200 back and you've built yourself some credit! It's a good start to seeing if credit cards are right for you or not.

I know this probably isn't what you want to hear, but I wish someone had told me when I first got one, and I'm only 24! :)

Answer 3

The most important thing is: pay off your credit card in full when the bill comes. So, don't charge more than you can pay off at the end of the month. Many cards do not charge annual fees - get a card that doesn't.

Answer 4

Pay it off every month. Don't buy what you can't afford to pay for when the bill comes. Get a rewards card, such as one that gives you some frequent flier miles or hotel points.

Answer 5

Use it wisely and pay the cc bills on time