Updated February 25, 2016

Credit Cards for Beginners

Read more about How Credit Cards Work

Looking to get a starter credit card but not sure where to begin? If you're new to credit cards, need a refresher, or you always let someone else take care of your accounts until now, help is here.

We’ll explain:

  • where to look,
  • how to choose,
  • and how not to get into hot water with your new credit card.

Using a credit card wisely and deciding which one to get takes a bit of research (not too much — we do most of it for you, below), and discipline.


Your choices may be limited at first: If you’re looking for your first-ever card, you may need to prepare yourself for some limitations. Since your credit history is likely very short or nonexistent, you won’t be eligible for the more lavish of rewards programs. But if you consistently pay your bills on your time, your first card will give you the track record you need to get access to potentially better cards.

You may need a secured credit card: A secured credit card comes with a much lower credit limit and requires that you put some money aside in a designated account to protect the issuer if you don’t pay your bills. You’ll likely have to pay a fee for this privilege, but do shop for the best deal. And verify that the credit card company reports your payments to the credit bureaus. This reporting builds up your credit history, and if you demonstrate a few months of good credit behavior (paying on time, staying within your limits), you should be able to get approved for an unsecured card sooner rather than later. (Unsecured cards mean fewer fees, higher credit limits, and more flexibility.)

You can get a good deal if you’re a college student: Other cards aimed at beginners are for college students. Many credit card companies have cards created specifically for college students. These cards generally have no annual fee, and they come with reward structures centered on spending categories favored by the college crowd, like movies and restaurants.

You can find a student credit card with no annual fee. You’ll also want to look for low interest rates and consider which rewards programs are most in line with the type of purchases you make on a regular basis. You don’t want end up buying things you don’t want or need just to rack up rewards.


Don’t worry about your beginner status — you won’t have to keep it long if you play your cards right (so to speak!). There are a few things to keep in mind to a) make sure you don’t unduly give up money when you are a credit card user; b) keep your credit card reputation intact so that lenders and other credit card companies down the road will trust you in the future and give you decent interest rates.

  1. Spend only within your means: Credit card companies want you to spend money — that’s why they make enticing offers and give out rewards. View your card as a convenience tool that gives you rewards on purchases that you would be buying whether you had the card or not. Otherwise you’ll find yourself buying some overpriced tchotchke just for the thrill of getting 5% back. Stick within your budget and you won’t get buried in debt.

  2. Never miss a payment: While it’s OK (sometimes, if you absolutely must) to have a balance, you should never, ever miss a payment. You must pay at least the minimum balance (and ideally more; see #3). You could get stuck with a late fee and your credit score could get dinged if you miss a payment.

  3. Always pay more than the minimum due: It’s easy to think all the credit card wants is that really small amount in the statement box that you have to pay at the very least. Don’t fall for it or you could end up in the minimum payment trap. If you can’t pay in full, promise yourself you’ll pay at least triple the minimum balance. If you can’t afford to pay that, then you’re not using your credit card wisely and you need to look at how you’re managing your debt.

  4. Avoid taking out cash advances: Those checks you get in the mail from the credit card companies cost you money if you cash them. And the interest rate on them will likely kick in right away. Cash advances should be a last resort only.

  5. Know your limits: Wow, you got a $5,000 limit on your card! Whoo-hoo you’re in the money! Not so fast. That’s the maximum amount of money you can spend with your new card — it is not free money. Be sure you don’t come close to that limit or else you could get denied at the register or you could incur a overlimit fee. Other lenders may frown upon you if you have one or two cards that are close to being maxed out.

Also be smart about how you use your card. Identity theft is a problem, as we all know, and while most credit cards offer $0 liability if your card is used fraudulently, it’s still a major hassle to untangle yourself from someone misusing your credit card digits. To protect yourself, read how to protect your credit card information.

The Next Step: When You Have Built Your Credit History…

Once you’ve paid your dues, so to speak, by using starter credit cards, you will have a slew of options. Here is what you need to keep in mind when you’re ready to transition from the “beginner” stage or if you have just a couple of cards already and want to take your credit-card usage to the next level.

Related: Credit Cards for Young Adults

  • Are you most interested in rewards: A lot of cards offer some type of rewards program, whether in the form of cash back or rewards points. There’s usually some tradeoff, though, between the quality and generosity of the rewards and the cost of owning the card. That cost can be reflected in either the interest rate or the annual fee.

    What to look for: You should be able to find a card that doesn’t charge an annual fee. You’ll also probably want a simple reward structure since you’re just starting out. Something that offers a flat cash back rate on all purchases would be a good option as opposed to complicated reward point structures.

    Related: Credit Cards for Beginners with Fair Credit

  • Do you want your rewards to be used for travel?: People who travel frequently might benefit from having a card that offers travel rewards. The issue here is that rewards structures are usually complicated and the cards themselves are expensive. Unless you’re a really frequent traveler and willing to put in the effort to learn the ins and outs of these cards very quickly, you’re probably better off with a simpler card.

    What to look for: A low annual fee is key, especially for a beginner. There are very few free travel cards, and annual fees are usually upwards of $50. You also want to make sure that the reward structure is straightforward and that you understand how, when, and where you can redeem them.

    Related: Travel Credit Card Offers

  • Is low interest your biggest priority?: It’s a good idea to pay your balance in full each month, especially as a credit card beginner. But for those wanting a little extra protection in case they go a little over budget, or those who want to use their credit card for short-term loans and spread out repayment over a couple of months, there are a number of cards that offer 0% introductory APRs. The length of this promotional period is usually in the 6–18 month range.

    What to look for: The length of the introductory offer and the interest rate that goes into effect after it ends are equally important. It’s also important to look for a card without an annual fee; otherwise, some of the money you save on interest payments will be swallowed up by the cost of just owning the card.

    Related: Zero Interest Credit Cards Promotions

First Time Credit Cards

How to Get a Credit Card: The key to choosing the best card is research.

Consider your options and make sure you understand the terms and conditions that come with each card. This is true for the newest credit card users and the most savvy credit card veterans. Weighing the cost of each card against its benefits will reveal which is the best choice for you.

More from CreditDonkey:

Credit Cards for Young Adults

How Credit Cards Work

How Credit Cards Work

Best Credit Card for First-Time Applicants

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About CreditDonkey®
CreditDonkey is a credit card comparison website. We publish data-driven analysis to help you save money & make savvy decisions.

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CreditDonkey does not know your individual circumstances and provides information for general educational purposes only. CreditDonkey is not a substitute for, and should not be used as, professional legal, credit or financial advice. You should consult your own professional advisors for such advice.