Welcome to being a grown up! Here are some tips to become the responsible adult your parents think you are:
1. Start off slow and small. Credit cards are here to help you build credit and even I am surprised at what I can buy in a day. Put small, recurring charges on your card like gas or a Netflix subscription.
2. Don’t bring it with you to a bar. Once you are a drink or two in the last thing you want to do is feel like you have the buying power to hook up your friends or a group of cute girls that you want to impress. Leave it at home!
3. Pay the bill when it comes and on time! Something as simple as overdue library books can hurt your credit score. Paying at least the minimum balance on your credit card on time is vastly better than not paying or paying late. However, you should strive to always pay more than the minimum balance or you may be paying that balance off for a long time. If you have a hard time remembering when things are due, set up an automatic draft with your bank to make sure the credit card bill is paid every month.
4. Great deals don’t last! Signing up for no interest is smart. However, making a payment late or skipping a payment usually means that you have to pay a high interest rate and possibly back interest from the time you got the card. Also, if you have 0% interest for the first 12 months – be sure to remind yourself when that deal is up.
5. Take a peak. It doesn’t hurt to check your credit score once a year to make sure you are on the right track and make any adjustments in your spending. There are sites that are free and sites that are not “free” (charge your credit card after a limited time).
Before you apply for your first credit card make an appointment to have expert help navigate what credit cards fit with your goals. Mistakes like not paying on time and spending too much can leave you in a giant hole and can cause damage for up to 7 years or can lead to bankruptcy that can seriously damage your lifestyle for 10 years.