credit cards?

i am just turning 18 and i am wondering weather or not i should get a credit card. I have a steady job and have had one since i could work at the rightfull age of 14. so i know the imporance of money. The credit card would be used to help build my credit score. and would i want to get one from a store liek cabelas,scheels, or gandermoutian or would it be best to get one right from the bank? or not get one at all. and also what are the chances of being able to get one with just starting to build your credit

Some may disagree with me, but in today’s world you do need one. You are correct that you need to build a credit score as things such as future home or car purchases go the best they can.

I agree with getting one that earns you points but look hard for one without an annual fee, though that’s not always easy with those that earn points.

The biggest downfall of cards is over spending what you can afford. If there is anything in my life I wish I could go back and change, it is my use of credit over my career. It was not what you call ideal. I always had a job to cover the fees but…..
Work hard to pay them off every month or keep very low balances.

Good luck!!

Eric

You better know how to manage your money before you get into that game.

If you are responsible, I think it is a good idea to build your credit history, but I would not recommend using it for big purchases. Make smaller purchases and pay off the balance monthly to establish a positive credit history. I would avoid carrying a balance.

If you are wanting to make a big purchase that you can’t front the cash for, I would not recommend it. It’s a slippery slope, and credit mistakes at your age can haunt you for a long time.

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The biggest downfall of cards is over spending what you can afford. If there is anything in my life I wish I could go back and change, it is my use of credit over my career. It was not what you call ideal. I always had a job to cover the fees but…..
Work hard to pay them off every month or keep very low balances.

Good luck!!

Eric

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X2 Never use it for financing and look into their identity theft and consumer protection. They are great tools when used properly. If you start rolling over a balance, its a steep cliff to fall off of.

Only get one if you plan to pay off your balance in full every month. That is the way to build up your credit score. I do not ever buy anything that I know I cannot pay for. You do not want to finance things if you can help it. Large items such as a house or a car are OK to finance, just do not get in over your head. I would recommend the Chase Freedom card as it has 1% rewards on all purchases and up to 5% on selected categories every 3 months.

my idea would be to use it for gas and small stuff that i need now and pay it right as i would get my paycheck back

I got my first credit card around 50 yrs old. I was always scared to own one. I now carry one Cabela’s credit card and one Credit Union debit card. Getting a credit card was one of the best things I have ever done. I charge everything I can. No more having to get cash every week.
The reason for the debit card would be, Sams and Aldis do not accept my cards,but the debit card is o.k..
Learn not to over spend! What worked for me, each time I used the charge card I would write it down in the check book as though It was a check written. Subtract it like you would with a check. You will always now how much money you have spent.
Good luck, and do not charge any more then your balance in the check book and you will be fine.

Dont do it, You dont need to build a credit score, what you need is to build a savings account, you can get loans from banks without credit scores. I’ve been credit card free for 5 years now, best thing I ever did, I have visa debit cards that come from my personal accounts.

Look into Dave Ramsey, he’ll change your way of thinking about credit and money.

Being truly debt free with no payments will lead you to earlier wealth for yourself, wish I had known when I was your age.

Good luck

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my idea would be to use it for gas and small stuff that i need now and pay it right as i would get my paycheck back

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I would get one from the bank, preferably with low or no fees. I would stay away from cards with points; it may just entice you to spend more. Keep it simple and like others said, pay it off every month. Get on-line banking and mark your calendar to pay it the same day every month.

Have had one with capitol one for many years and have been happy with it. Use it for my day to day business expenses and pay one bill at the end of the month. Its not very often I make a purchase on it that can not be paid off in full at the end of the month. Dont remember what the interest rate is on this card. Must be because I never allow them to charge me interest.

Besides not paying off the cards every month it seems missing a payment or late payment is a common issue. We went to scheduling all of our bills to be due during one week every month. Its very easy to make sure they all get paid this way and we do not have to keep track of them for the rest of the month. Then to go along with this we even switched to getting paid once a month. Makes a person watch how they spend so there is money to pay the bills at the end of the month. Very simple trick to teach a person basic budgeting and money management.

It seems to me that store cards charge much higher interest rates. Cabelas, Gander, ect maybe well into the 20% rate. Some my wife has had where up to 25%. She is not allowed to have cards anymore due to not know how to use them. Those rates are nothing compared to additional fees if you miss a payment or are late on one. The perks you get from store cards might be easier to use, say from cabelas. But if you get in trouble with them or get charged interest it will cost you much more.

The only way to have a credit card is to pay it off in full every month. If you can not do that do not make the purchase.

Working in the credit business, its important that you manage your balance to credit limit. You don’t build your credit score faster if you pay off the debt in full each month because it doesn’t show to credit bureaus your ability to manage a consistant monthly payment. We as consumers know that paying off credit cards in full is the best way to avoid paying those high interest rates on credit cards, but Experian, Equifax, and TransUnion (3 major credit reporting agencies) rate your credit history based on how you manage your credit balance in relationship to your high limit. Take for example you have a cc with a limit of 1000 bucks, and monthly you have a revolving balance greater that 500 it can actually hurt your credit score vs. helping you build credit. This is just an example, but ideally to build credit fast is to charge a tank or 2 of boat gas in a month pay it down to like a dollar, revolve that dollar into next months cycle and repeat but the next month pay it off in full. Allowing some money to revolve (obviously as little as possible to avoid that high interest) will build your credit FAST, if that is what your looking at doing. For everyone else who has established credit scores I strongly suggest paying your monthly balance off in full each and every month to avoid any interest. You have a credit history already so your score will not be impacted as much if you pay off in full each month vs. revolve some of your balance.
The credit industry is very weird and complex, lots of different opinions about how to build and maintain good credit, I am speaking of my expierence over the last 12 years in the credit business. Good luck spend wisely.

I’m with Cal. I have credit monitoring and I was surprised by the bump I got from keeping a low balance that carried over every month. I make small purchases staying well below my limit every month. I then pay enough to bring my balance down under 10% of my limit.

Dave Ramsey webpage. Awesome advice in my opinion. Browse around his site!

Check out this link. Fantastic info!

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Dont do it, You dont need to build a credit score, what you need is to build a savings account, you can get loans from banks without credit scores. I’ve been credit card free for 5 years now, best thing I ever did, I have visa debit cards that come from my personal accounts.

Being truly debt free with no payments will lead you to earlier wealth for yourself, wish I had known when I was your age.

Good luck

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I disagree, you need credit if you ever plan to buy a house or a car. You probably wont even be able to get a credit card without any previous credit or a co-signer. I know some banks are starting to do a secured credit card that “some” report to the credit bureau’s, you will obviously want one of those to build credit. Keep it small and never carry a balance and you will be alright.

Good Luck

I would get 20 credit cards, party like a rock star, declare bankrupcy by 21 and start over. That way, by the time you are 30, you will have a clean slate and can start being responsible.

Dont listen to these commies, BE AN AMERICAN!

Woooooooo!!!!!!!!!!

I got a credit card when I was 18 and it easily set my savings back 5 years. I never had a late payment and always had a reasonable interest rate, but when you’re borrowing money every month it’s hard to keep your eye on the ball every time you take the plastic out. At the end of the month you’ll have less to save because of the CC bill.

I respectfully disagree that you should get a credit card to build your credit. There are other ways of doing that, and while building a good credit score is important, it’s not important enough to justify the use of a credit card at 18. If you have a regular income, cash in the bank, and 20% down you’ll be just fine.

I’d recommend using a check card to start. ING is an online bank with a check card that I’ve always liked a lot. I also second the Dave Ramsey refernece. That guy will get you on the right track. At least check his info out before you apply for a card.

One last piece of advice that I’ve always liked: It’s not what you make; it’s what you spend that matters. Keep your cash flow into savings positive every month by 10% or so and you’ll be set for life. Much easier said than done, especially with a credit card.

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Dont do it, You dont need to build a credit score, what you need is to build a savings account, you can get loans from banks without credit scores. I’ve been credit card free for 5 years now, best thing I ever did, I have visa debit cards that come from my personal accounts.

Being truly debt free with no payments will lead you to earlier wealth for yourself, wish I had known when I was your age.

Good luck

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I disagree, you need credit if you ever plan to buy a house or a car. You probably wont even be able to get a credit card without any previous credit or a co-signer. I know some banks are starting to do a secured credit card that “some” report to the credit bureau’s, you will obviously want one of those to build credit. Keep it small and never carry a balance and you will be alright.

Good Luck

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You’re missing the point, point is living debt free, buying a car with money you have on hand, paying cash.

You can find lenders who will do manual underwriting when you have no credit and have cash to put down on a house.

All the big 3 credit agencies do is rate how well you handle debt, debt is what keeps you from gaining wealth. Believe me , I’ve been on both sides of this issue, going all cash and not taking on any debt is the way to wealth.

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All the big 3 credit agencies do is rate how well you handle debt, debt is what keeps you from gaining wealth. Believe me , I’ve been on both sides of this issue, going all cash and not taking on any debt is the way to wealth.

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For ever and ever AMEN.

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Working in the credit business, its important that you manage your balance to credit limit. You don’t build your credit score faster if you pay off the debt in full each month because it doesn’t show to credit bureaus your ability to manage a consistant monthly payment. We as consumers know that paying off credit cards in full is the best way to avoid paying those high interest rates on credit cards, but Experian, Equifax, and TransUnion (3 major credit reporting agencies) rate your credit history based on how you manage your credit balance in relationship to your high limit. Take for example you have a cc with a limit of 1000 bucks, and monthly you have a revolving balance greater that 500 it can actually hurt your credit score vs. helping you build credit.

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I work in the industry too, and I agree with most of what you’re saying above. Loan utilization (balance-to-limit) is important. Something like 10% is perfect if you want to max your credit score.

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This is just an example, but ideally to build credit fast is to charge a tank or 2 of boat gas in a month pay it down to like a dollar, revolve that dollar into next months cycle and repeat but the next month pay it off in full. Allowing some money to revolve (obviously as little as possible to avoid that high interest) will build your credit FAST, if that is what your looking at doing. For everyone else who has established credit scores I strongly suggest paying your monthly balance off in full each and every month to avoid any interest. You have a credit history already so your score will not be impacted as much if you pay off in full each month vs. revolve some of your balance.
The credit industry is very weird and complex, lots of different opinions about how to build and maintain good credit, I am speaking of my expierence over the last 12 years in the credit business. Good luck spend wisely.

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This I don’t agree with. The card provider reports your balance each month. Credit scores don’t care whether that balance was carried over from the prior month or charged in that month. What matters the most is whether you’ve had a late payment or anything else negative, how long you’ve maintained good credit, your utilization (balance-to-limit), and whether you have a lot of inquiries.

Carrying a balance forward will incur interest costs, but even more so will probably incur finance charges. It seems like that’s what you’re recommending and I don’t agree with this advice.

Get the card. Pay off the balance in full each month. Make sure you incur no costs and take advantage of the float they’re giving you. Get rewards points and redeem for cash. It will set a start date for your credit history, and the longer that history the more it will improve your score.

Well from my perspective as a Dad it is a good thing. My son got one from the bank when 18 and headed off to college. Been 2 years now and he pays it off every month. Handles all his needs and is helping establish a credit history and teach him about handling his own money. Hard to do everything in cash when away from home.

Not to hi-jak the thread – but what is a realistic, attainable credit score for an average person? Good/great/unheard of???

You might want to consider a debit card that lets you charge up to what you have in your checking account. That is what I set my kids with (13 and 16). They think it is cool to have and gets them to be responsible at a younger age.

You could also get a credit card and tell the company to keep the limit low when they try to higher your limit tell them no. I think you can do this. Many people I think get into trouble when the company highers their rates above what they can really aford.

#1 issue is you have to make sure you pay it off each month.

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Not to hi-jak the thread – but what is a realistic, attainable credit score for an average person? Good/great/unheard of???

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Between 700 and 850 – Very good or excellent credit score.
Between 680 and 699 – Good credit score.
Between 620 and 679 – Average or OK score.
Between 580 and 619 – Low credit score.
Between 500 and 579 – Poor credit score.
Between 300 and 499 – Bad credit score.

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Not to hi-jak the thread – but what is a realistic, attainable credit score for an average person? Good/great/unheard of???

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Here is a good article:
http://www.creditscoring.com/average/

I got my first/only credit card at 18. I bought socks once and carried the balance over. My credit score jumped. Since then, I have yet to carry a balance. My credit score is 807. I like to have it for emergencies (for example I was in Green Bay and my fuel pump went out). I have one that earns cash. I just got a check for $150 (bought a new rod and reel). If you are asking the question, chances are you are aware of the pitfalls that comes with undisciplined use. I like to use it for big purchases when I know I’ll have the cash to pay it off. It earns some decent money that way. I use it as a convenience, not a necessity.

Good luck. You’ll be fine.

I don’t think you need one and 19 year old daughter does not have one, and she is off away at college. I and the FW have never paid a single cent on credit card interest, and when we refinanced our house to 10years the loan officer said we had one of the highest credit scores he had seen. I got my first car loan when I was 19 so you can get loans without a credit card. We did not even have one for almost first ten years of marriage. At your age if you need one that means you cannot afford One!

I feel that Dave Ramsey’s Financial Peace University class should be mandatory in every high school. I took it a few years ago and it changed my life financialy. It’s easy to say you will pay off the balance every month but we all know how easy it is to let it slide one month. That snowballs. Years later you are still trying to pay it off. Or you need the card just to buy food and supplies for the month because you are broke. Been there and still trying to pay it off. I wiould say take a financial class first.
DT

where would u take a class at.

I know a few of our local churches have put them on. Maybe check his website.
DT