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Date Posted: 21:19:49 03/03/11 Thu
Author: Drew Cassels
Author Host/IP: NoHost / 69.168.143.54
Subject: That AnticipatedFirst Credit Card Application

These days, applying for a credit card is considered a financial rite of passage, one of those things that is much anticipated. The majority of people know that receiving a credit card is important; your credit rating, starting from your first credit card, sets a financial foundation that can last for life. It is important to realize that credit cards aren’t for everyone.

New credit rules in the U.S. insist that you get a co-signer if you are under 21 and don’t make enough money for payments. Even if you are older than 21, you might not be prepared for a credit card. Before getting a credit card, it is vital that you honestly evaluate your finances, and your habits. You should carefully consider whether or not you are truly ready to complete that Credit Card application .

Credit Card Problems

One of the biggest pitfalls of getting your first credit card card before you are adequately prepared is that you could quickly build up a great deal of debt. Credit card use can be almost addictive. You feel as though you can buy anything – no matter the price. The minimum payments on credit cards are so low that you might actually believe that you can afford to purchase an item you would never buy if you had to pay from your checking account.

Because many people get their first credit card when they are young, and youth is often associated with impulsive behavior, it isn’t really a surprise to onlookers when impulse buys multiple and debt mounts. For some students, getting a credit card too early leads to a cycle of debt. No matter if you have the best credit card offer imaginable, with the best credit card rewards, you could wind up in too much credit card debt. If you don’t want to end up in that position, you need to ensure that you are truly ready for your first credit card.

How to Tell If You’re Ready for a Credit Card

You need financial discipline if you are going to use a credit card responsibly and avoid the pitfalls associated with credit card debt. Here are some financial habits to develop now, to help you prepare for your first credit card:

• Be able to make a budget or spending plan and stick with it.
• Understand the importance of saving. Start an emergency fund and set money aside each month for retirement or other money goals.
• Create financial and spending goals. Get in the habit of saving up for large purchases. This way, when you do use a credit card, you can pay the balance immediately.
• Be aware that credit cards are not reflections of money you already have. Credit cards are loans that you have to repay with interest.
• Practice with plastic by using a debit card responsibly. Track you spending and avoid overdrawing your checking account.
• Stay away from debt as much as you can. When you do have to borrow (for an education, car, etc.), get as little as possible.
• Choose to pay down debt you do have as quickly as possible.

When you show that you can control your spending, and if you are willing to keep track of what you put on your credit card, you are showing that you should be prepared for your first credit card. After getting your card, it is important that you continue your good financial habits. Don’t put more on your credit card than you can pay off each month. Track your spending and stick to a budget. You can ease into using credit by getting a student card, or a card with a low credit limit.

Before you fill out an application for your first card, learn to properly budget your money. Personal finance software and web applications can help you understand budgeting while teaching you to track your spending. A certain comfort level with budgeting and other aspects of financial planning is necessary for wise credit card use.

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