Credit Card Facts and Fears

In honor of Credit Education Month, here are some facts to better educate you whenever it comes to the choice of your credit future.

Why is this important?

Credit cards can help you build a healthy credit score  and that is something that can change depending on how you handle your money. Obtaining and maintaining a good credit score is important because it affects the interest rate you’ll get with any sort of loan and lenders use it to determine if you are a worthy risk. Today, it’s also common for employers to check your score during the hiring process to see if you are a responsible person. You may think that if you do not have a credit card that you will have a good score, but this actually can detract from your overall score value.

Should I Get a Credit Card?

If used responsibly, a credit card may help you establish a better credit score. But before you apply, it’s important to decide if you are ready for a credit card.

Just ask yourself if you feel that you are currently financially stable and pay your bills on time. If the answer is ‘yes’, it could be a perfect time to start building your credit. You can protect yourself by keeping your credit limit low so you don’t have to worry about getting out of control. More importantly, know that you potentially have options and can “shop” for the right credit card that fits your life. Student credit cards and Credit Builder cards can be a less risky option to get you started. No matter what you chose, you should never feel limited or pressured into any option.

What should I do?

Credit is something that builds a snapshot of your financial history and will follow you for the rest of your life. While never having a credit card may protect you from the debt from the misuse of credit, it can also hurt your future if you never get one. With a good score, you will qualify for better interest rates when getting future loans. It is a really big decision getting your first credit card and it is one you should not take lightly. Ask yourself the big questions and make good decisions based on your answers.

Best of luck to you and your credit future!