Man checking credit card balance
WAYHOME studio/Shutterstock

Advertiser Disclosure: The credit card offers that appear on the website are from companies from which this site receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). This site does not include all credit card companies or available credit card offers.

Information about credit cards and card offers is accurate as of the date of publication.

In this day and age, there’s a credit card for everyone. From secured cards for basic credit-building to premium airline and hotel cards, you can find the perfect option for your lifestyle and spending habits.

Yet, for some, the idea of applying for and owning a credit card can be daunting — I myself waited quite a while before applying for my first card.

So, what’s the cost of not owning one? I took a look at the cash back I earned my first year of card ownership and the savings I missed out on by not owning a credit card beforehand.

My backstory

I received my first debit card at age 16. It was exciting to finally have access to the money I had been making for a year or so at after-school and summertime jobs. For years I stuck with that debit card, and according to a recent survey by CreditCards.com, I’m not the only one.

Thirty percent of U.S. credit card holders have never changed the card that sits top-of-wallet. That means 30 percent of cardholders have been using the same card for years on end.

In my case, I had been using a debit card when I instead could’ve been earning rewards (or at least building credit) with a student or starter credit card. Since I was only 16 at the time, I also could have been added as an authorized user to one of my parents’ cards.

What I could’ve been earning

My first card was the TRIO® Credit Card from Fifth Third. Being from Indiana, Fifth Third was a familiar choice for a credit card issuer considering I’d been banking with them my entire life.

This card earned me 3% cash back rewards at restaurants, 2% back at gas stations, grocery and drug stores (up to $1,500 spend per quarter combined) and an unlimited 1% back on everything else. I also received a $100 bonus for spending $1,000 in my first 90 days of card ownership.

My first year of owning the TRIO, I spent around $400 a month — $100 at restaurants, $100 on gas, $150 at grocery stores and $50 on all other purchases. That means I had been missing out on $108 a year in cash back ($208 including my first-year welcome bonus) by not owning my credit card beforehand.

Other perks I was missing out on

Other than a decent rewards structure, the TRIO Credit Card offered me a low introductory balance transfer APR, no foreign transaction fees, cell phone protection and a $0 annual fee.

I didn’t have a large purchase to pay off or any debt to dwindle, yet introductory APR offers on purchases and balance transfers are a great way to do so. These offers allow you to pay off debt or purchases without acquiring interest fees in the process.

For example, if you had $2,000 in debt and applied for a credit card with a 0% introductory APR on purchases and balance transfers for 14 months (13.99% – 24.99% variable thereafter) such as the Discover it® Cash Back, you’d be able to pay $142.85 a month without paying a dime in interest.

How you can get started with your first card

Ready to start earning rewards? Before you get started, it’s important to have a firm understanding of your credit score. That number will determine which credit cards you have a chance at being approved for.

Additionally, decide what type of rewards you’re most interested in earning — you can choose from cash back, miles and points, but make sure the card you choose correlates with where you spend the most money.

If you tend to spend a lot on gas each month, you might benefit from a gas rewards credit card. If you enjoy traveling a few times a year, you might look into earning miles with a co-branded airline card.

For more information on how to get your first credit card, read our newbie’s guide.

The bottom line

You could be missing out on quite a few perks and rewards by not owning a credit card — simply look to my story as an example.

Although taking the first step may be hard, the rewards and financial freedom will make the process worth it in the long run.


Editorial disclosure: All reviews are prepared by Bankrate.com staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including card rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the bank’s website for the most current information.