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Getting your first credit card is a big step toward building your credit history. Reviewing the ins and outs of the process will help you learn how to research different card types, choose the best card for your situation, and use the card to help raise your credit score.

Check your credit reports

Before you start looking for credit cards, it helps to know your credit score. A higher score can help you get a lower interest rate. Even if you’ve never had a credit card before, you might have a credit history if you’ve ever taken out a personal loan or auto loan in your name.

Go to to get free copies of the three credit reports generated about you by TransUnion, Equifax and Experian. Check all information in each credit bureau’s report, and if you find any mistakes, visit the bureau’s website for instructions on how to dispute the error and get it corrected.

Do the research

Before you apply for a credit card, research your options. Some cards might offer low interest rates but carry high annual fees or very low credit lines. Some credit cards offer rewards, such as points for each dollar you spend. The points might be used to reduce the cost of airfares, hotel stays and gifts you purchase.

Apply for the card

Once you have checked your credit reports, done your research and know which card you want to apply for, make sure you have all the information you need for the application. Do not apply for multiple cards thinking you’ll cancel the ones you don’t want (e.g., your second and third choices). Each time you apply for credit, lenders pull your credit report, which can ding your credit score.

How to use your first card

Once you have your first credit card, use it correctly if you want to raise your credit score. The biggest factor in your credit score is your payment history. If you don’t use your card, you don’t need to make payments and can’t build a payment history. Make at least one charge each month, and make your monthly payment on time.

Consider creating an account at your credit card issuer’s website so you can have payments automatically withdrawn from your checking or savings account each month.

Don’t go over your credit limit, and don’t use most of your credit limit. The second-biggest factor influencing your credit score is your credit utilization, or your debt-to-credit ratio. If you get a card with a $1,000 credit limit and make $800 worth of charges, you’ve used 80 percent of your credit. Keeping your balances to under 30 percent of your available credit line is a good guideline if you want to raise your credit score.

If you have trouble getting a card …

If you have no credit history and are having trouble getting a card, try to become an authorized user on someone else’s card. Understand that your use of the card will affect the person who put you on their account, perhaps damaging their credit score if you make mistakes with the card. The person who puts you on their card is financially responsible for your use of that card.

  • Get a co-signer: Another option for getting a credit card is to ask someone with good credit to be a co-signer on your card. This lets you have your own credit card and remain the primary cardholder. Be aware that if your co-signer has access to your card, he or she can use it, too.
  • Get a secured card: A bank or credit union can issue you a secured credit card that uses a checking or savings account with a deposit in it as security. If you fail to make your monthly credit card payments, the bank will take the deposit out of the checking or savings account that “secures” your credit card. The credit limit on a secured card is typically the same as the deposit amount. Check to make sure that your bank reports your activity with the secured card to the credit bureaus to build a good credit history.

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