Apply For Credit Card

Applying for that first credit card can be exciting, and intimidating. Credit cards do come in handy when you rent a car or book a hotel room. It also helps you establish a credit record. But never forget, if credit cards are mishandled, credit card debt can become your worst nightmare.

If you don't have a card, you can get an application at your local bank. You can also find credit card offers online.

Usually, if you have no credit history, but are at least 18 years old with a job, you'll be able to get a card with a limited amount of credit, typically from $500 to $1,000. If you are diligent with your payments, you should be able to have your credit limit upped after about 12 months. The amount of the increase is dependent on your income or your ability to repay the line of credit.

Co-signers and Secured Cards
If you have no credit history and your earnings are low, or you have a bad credit history, you might not be able to get a card in your name alone. You may need to apply for a secured card or get someone to act as a co-signer or guarantor. A co-signer, or guarantor, is someone who agrees to assume responsibility if you can't, or don't pay off credit card debt.

A secured card is when the bank or credit card company requires a deposit that serves as collateral. The deposit is equal to the amount of credit allowed on the card. There are often other fees charged to open a secured account, so be sure to read the fine print.

Also if you do get a secured card, be sure you find out when your account can be converted to a standard account. At that point, you should get your full deposit back, provided you have made timely payments and don't owe any money on your credit card.

If you have a co-signed credit card, remember that the co-signer is on the line along with you. If you miss a payment, chances are you'll get a phone call about it.

Choosing a Credit Card

Before signing up with any credit card company, do some comparison shopping. Experts agree that a low, fixed-rate card is better than a low, variable-rate card. You should also be very careful of low "teaser" rates.

You should keep the number of credit cards to a minimum and make certian that each card meets your particular needs or provides specific advantages not available with the others.

Both MasterCard and Visa are so popular and widely accepted that there is no need to carry both of them. Choose the one with the best terms offered by the bank to which you apply.

Zero-or-low interest rate is best if you are willing and able to pay down existing credit card debt relatively quickly as the low rate usually only lasts for only six to nine months, then reverts to something higher.

Reward cards are best if you make the majority of your purchases on a credit card and pay off the balance each month. These type cards usuallt offer cash back, airline miles or points toward purchasing select merchandise based on the amount you spend. The downside is that some cards have high interest rates and annual fees.