Wednesday, October 30, 2013
My First Credit Card
In today's day, having a credit card is beyond a privilege, it is a necessity.Credit cards are the most convenient method we currently have for point of sale purchases and online payments. You do not have to worry about carrying your money around, let alone losing it. It has proven to save us time and most importantly money. There are cards for every spending budget, reward benefits, and special features tailored for each consumer. They can really come in handy during emergencies too. You will never know when you will need it until the day you need it.Whether you are a student or have never been accepted for a card, we can help you obtain your first card because we know it can be a challenge. There are many credit cards out there that promise the world but end up have strict requirements and require credit in order to apply for them. Well there is good news; there are many credit cards that are providing high school students, college students, or just anyone with limited or no credit a the chance to start building there credit. They do not even check your credit. Also known as student credit cards typically have a low starting credit balance and/or require a minimum deposit. They might also have additional restrictions but are installed to keep you in line and give you a helping hand into the credit journey. There are other available options available on the net.One of the best ways to ensure you receive your first card and even insure sufficient buying power is through a cosigner. A cosigner can be your mother, father, uncle, aunt, or anyone that trusts in you and is willing to back you up with there credit. That's right, back you up! That means that they are also responsible for any charges you secure. This is the credit card companies' collateral or insurance policy to make sure someone pays. This is by far the fastest way to build credit. You can easy build up credit and therefore confidence with creditors. Before you even know it, you can start applying for credit cards and purchases on your own. This may take over a year with good payment history. The key rule to establishing credit and improving your score is to continue paying your bills on time.Typically, the Annual Percentage Rate also known as the APR will be a little higher than a normal credit card. This is industry standard as there is a perceived risk of extending credit to a younger demographic. The credit limit is usually between $200 to $900 depending on the payment history and credit of your cosigner and yourself. We do not want you focusing on this for know. The most important thing is that you start applying for a card; start establishing credit by using the credit card for every day expenses; and paying the bill on time. Do you see the reoccurring theme, "Pay on time".You are then able make some key purchases with out carrying around all the cash. Whether you paying for text books or just paying for your lunch, a card is the ultimate luxury. One of the best benefits is the ability to research products and services online and having the convenience of charging your card on the spot and shipped or downloaded immediately. Talk about convenience.This first credit card is only the stepping stone to a huge future. Some of our clients and readers all started there credit credit journey with there first card and are today part of the 800 club. Once you have established a good credit rating with your first card, student credit card or beginner card, you will be on your way to being approved for much larger loans. Hey, it may be your first car, home, boat, or that world class vacation you always wanted to take. What ever your goal, your credit can take you there.We asked the members of the 800 club (individuals you have succeeded to have a credit score over 800), what was the major benefit they received from there first credit card? It was an overwhelming response! Most of them said responsibility. The responsibility they learned from knowing what they were able to afford and charge on that card has transferred over to the rest of the money making decisions throughout there lives.On the other hand, some of our clients and readers have learned there lessons but the hard way. Let's all learn from there mistakes and avoid them. Remember, credit cards can be a double edged sword. They can provide you the convenience and leverage needed for every day purchases and they can also overcome us. This can be dangerous. The danger of spending above and beyond the credit limit comes with penalty fees if they even allow it. It can also come in the form of simply spending more than the money saved or income being generated. The inability to effectively pay your bill when it arrives can negatively affect your credit. The creditor will also go after the cosigner so make sure you write down a tight budget to adhere to so this never occurs. If it ever does occur, do not try to cover it up. Talk to your cosigner or relatives to come up with a immediate and long term recovery plan.The pit falls lead us to a safer alternative, prepaid card. Prepaid cards are a great choice and can be used as the first step before applying for your first credit card. They give you all the convenience of a credit card but do not have all the fees associated with any errors you may have. Below are our recommendations. The card provides you with a checking account were you can have your employer direct deposit you're money and even use it for your every day spending but only up to the amount of money you have deposited. This card has many other amazing bonuses and features but check them out for yourself. They even provide a credit builder feature that enables you to begin building your credit right away.If you are a parent reading this, do not be afraid. When it is all said and done, the benefits definitely outweigh the drawbacks. For your children's life, obtaining a credit card can be one of the best confidence builders and safety nets you can partake together. It can keep them out of harms way; you never never know when they will need it. One day they can be stranded somewhere on the side of the road and without that credit card, they would have not been able to get home safe. We can go on and on, the fact is that many situations can present themselves were a card is the only solution. You can make allow you siblings to use it daily or apply restrictions to only emergency usage. Look into obtain a credit card for there safety and convenience which will enable them to establish credit and take them further in life.