Once you get your first credit card, here are a few tips to help you use it responsibly:
Pay your bill in full and on time each month to limit interest charges. If you can’t pay off the entire bill, pay as much as you can and don’t charge anything else until you’ve paid off the balance.
Keep a low debt-to-credit ratio. Using less than 30 percent of your total credit card limit each month positively affects your credit score.
Read your credit card statement carefully each month to look for any fraudulent charges. If you find any, contact your credit card company right away.
Avoid cash advances. They come with a fee and an interest rate that’s typically higher than the rate you’ll pay for regular charges.
Don’t fill up your wallet with plastic. Once you have your first credit card, you’ll likely receive offers from other card issuers. But having multiple credit cards can complicate your financial life and make it easier to overspend or miss payments.
Following these tips will not only help you build a good credit history, but they’ll also create the solid financial habits that can help you use other financial products wisely. That way, a first card truly becomes a building block for a solid financial future.
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