First credit card to establish credit?

For just about anything you want to get off your chest about credit cards.
18 posts
Crashem
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Postby Crashem » Wed Mar 28, 2012 4:36 pm

Crashem wrote:2) Scenario 2: Don't Trust himself with credit:
Still go and get VISA/MC student card but go ahead and leave card at home/hide it. Whatever. Just use it once it a while. Remember bad credit history is worse than no credit history. Instead of a debit card, go get a PASS card from AMEX. While the pass card won't build history with credit bureaus, AMEX will track it and has some program to invite you to convert to regular AMEX if you use the pass card regularly.


I was wrong on the name of the AMEX pre-paid card. It isn't the PASS card. See the link below for more info:

A learner's permit for credit? | Bankrate.com
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Celestine
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Postby Celestine » Wed Mar 28, 2012 7:37 pm

Crashem wrote:Actually given that Descension has income, he should qualify for some student credit cards. If he can get a parent with good credit history, he can even skip the student cards. He should skip some crappy secured card that will offer no credit line increases and annual fees. Ideally he should get 2 cards. Get ones with good rewards (whatever kind he wants). And/Or card with low APR if he is planning to keep balance (which he shouldn't be). By the time he graduates he will have a solid credit history with 2-3 cards to build on. Student cards, given the Card Act 2009, isn't as easy to get as they used to be. Now if Descension doesn't trust himself with credit..., he should do scenario 2.

1) Scenario 1 Trust himself:
Consider the following: Citi Forward Card for Student (Reward card), Capital One Journey Card for Students (cash back with credit montioring features), Go to local Credit Union and see if they have card for student, if you have bank account go talk to them. Remember NO ANNUAL FEE and some kind of reward. Don't carry both cards. Pay in Full and treat your credit not credit but spend as you would if it was a debit card.

2) Scenario 2: Don't Trust himself with credit:
Still go and get VISA/MC student card but go ahead and leave card at home/hide it. Whatever. Just use it once it a while. Remember bad credit history is worse than no credit history. Instead of a debit card, go get a PASS card from AMEX. While the pass card won't build history with credit bureaus, AMEX will track it and has some program to invite you to convert to regular AMEX if you use the pass card regularly.


The OP should not be concerned with rewards or points for now. It is about making priorities.

His primary focus/objective should be in building his credit history; not earning rewards or points. Piggy backing with other people's credit isn't really recommended. Once the parents' credit goes bad, the OP's credit history will also get a blow. Point in case, the OP needs to begin on his own so he can practice financial responsibility.

That said, student credit cards are fine as long as the OP is a student. There are student cards out there that offers rewards anyway. Although the OP should not focus on earning rewards at this time but building his credit. It is better though that he build his credit to good standing and later reap the benefits - applying for better credit cards.

Also, secured credit cards are also fine even though credit limits on those are usually low. The OP just needs to pay the balance before the billing cycle closes so credit utilization is kept to minimum.
"Nearly all men can handle adversity, but if you really want to test a man's character - give him power." - Abraham Lincoln

Crashem
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Postby Crashem » Thu Mar 29, 2012 12:08 am

I agree and disagree with what Celestine is saying. It is right to concentrate on building your credit history. Thats why you see if you can qualify for a card that will grow with you. A card you can keep long term. That is the problem with secured cards. They don't grow with you long term for the most part.

If Kreeker has the right credit to get a card he can grow with (rewards, no annual fee, CLI increases.), then he should get it. Even with beginner credit, there are certain credit cards that will grow with you.
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JohnnyCrawl
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Questions about getting the first credit card

Postby JohnnyCrawl » Sun May 27, 2012 5:04 pm

Hey, new to the forums and decided to sign up when I had a few questions of my own.

I just finished up my senior year of High School about to attend college. I haven't had any job experience, or had any experience with cards (credit or debit). I've been given a Summer job by school so I've decided for the Summer to invest in a debit card in order to practice up to using a credit card. I heard good things about the Citi Forward for College students so I decided that will be my first.

1) I'm interested in signing up for my local credit union and establishing a checking account to link to my debit card. When I get a credit card, is it possible to link the checking account to the credit card? Or should I just make a checking account with Citi?

2) I'm a little confused on paying for the credit card. So there's paying the full balance and there's paying the minimum balance. Can someone explain to me an example of this concept?

3) If no purchases are made in the month, do I still pay the full balance for the month?

Thanks for your time!

Money card
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Postby Money card » Mon May 28, 2012 12:24 am

I wouldn't link your credit card to your checking account. Example if you want a capital1 journey card you can have a checking account with them. but make sure whatever you charge doesn't come right out of your checking. you write them a check when your bill comes in or however your parents want to do it.
I have a capital1 venture card but I have a TD bank checking account.

an example of a concept let's say you have a Journey card for that month you charged 75.00 when your bill comes in it says pay at least 15.00 if you were to pay the full balance you would be paying 75.00 the minimum balance would be 15.00 I don't know if there's interest on student cards. but once your in the working world done with college and you have our version and you paid 15.00 there would be 17.90 depending upon your credit worthiness. so you would owe 55.00 x the 17.90 plus your next statement.
if no purchases are made the following month it would be 55x 17.90 depending upon your interest rate is I just used the 17.90 as an example.

JohnnyCrawl
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Postby JohnnyCrawl » Mon May 28, 2012 12:05 pm

Thanks for the reply Money card.

Do you suggest as a first year college student with the experience I have with money (haven't had a job till now, no debit or credit card) to have a debit AND credit card? Or should I stick to a credit card or a debit card?

Crashem
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Postby Crashem » Mon May 28, 2012 2:12 pm

You should have debit card. If you feel you are responsible with money, getting a credit card is good too. Building good credit early is great. Remember with card act, student cards require you to both have demonstrated income and be a student to get student credit card. As for linking to your bank account, you should do it for easier method of payment. I wouldn't authorize auto debiting for your bank account unless you are flush with cash so you can manage your cash flow better. However I don't think auto debiting of minimum payment is bad idea so you ensure you always pay in time. I would apply for 2-3 student cards at same time. But please be careful with your finances as easy to get in over your head. Always pay in full and treat your credit cards like cash, ie only spend what you can afford to pay right away. Citibank, discover, and cap one have student cards. Credit unions also often have student card programs as well. Assuming you do good job with credit, you will graduate with great credit and have your pick of cards
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Money card
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Postby Money card » Mon May 28, 2012 10:15 pm

JohnnyCrawl wrote:Thanks for the reply Money card.

Do you suggest as a first year college student with the experience I have with money (haven't had a job till now, no debit or credit card) to have a debit AND credit card? Or should I stick to a credit card or a debit card?


I would ask your parents this.. while you are at college do they think you should have a credit card or debit? If you're at a community school they may not mind you having a credit card, they can help you. They can give you a checks to write every time your bill comes in.

But if you are living on campus in a different state from where your parents are, they may want you to start out with a debit card.

I would ask your parents this.



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