When choosing a card, avoid variable and teaser rates, says Kenner. Taking on debt "is about anticipating what might happen," she says. "Of course, you plan to pay it off every month, but life is full of surprises.
Always consider credit card rates, fees and policies. Howard advises selecting a card that gives you a grace period, or an interest-free period between the time you make the charge and your billing date to pay off your charges. And shoot for a card with $20 or less in annual fees, he says.
Another option is a true "charge card," which requires you to pay off the balance each month.
But make sure you understand the penalty fees and rate increases that could come with a late payment, says Kenner.
Secured or unsecured?
Secured cards backstop your credit limit -- often a few hundred dollars -- with a deposit of equal size. Depending on the card policies and your credit card use, you may or may not get the money back later.Some cards will reward you by converting the secured card to an unsecured card after a certain period of good behavior, says Howard. But if you misuse the card or don't pay the bills, you could lose your deposit.
"There are good secured cards and there are secured cards which are rip-offs," Howard says. His advice is to look for a card with no application fees, annual fees of $50 or less and an interest-bearing account for your security deposit.
Also make sure to avoid cards that charge high fees. Some will charge amounts equal or close to the amount of the credit line, he says.
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