OT - First Credit Card
Off season. Ignore if you want.
So, trying to figure out my first credit card. Been doing some research and have put together some options, but I wanted to get some feedback because I'm sure several people on the board are/were recently in a similar situation as me.
Recent finished grad school - 2011.
Never had a credit card (only check card).
Beginning year 2 of real-person status.
Have steady job, living comfortably.
Paying well over the minimums on student loans, currently, so I think my credit score would be better than a normal person that's never had a card.
Would pay full balance of card monthly.
The only reason I'm getting one is because it's one of those things you have to do. I'm of the opinion that if I don't have the money to buy something, I have to wait until I do. I'm just looking to build credit. Should I look at a credit card through a gas station? I've read I should ignore the sexy reward programs. Any anecdotes out there? Anyone really like their decision? Anyone really not like their decision?
Well the card I use is the University of Michigan Platinum Plus Mastercard with Bank of America. No annual fees and the best part is I live in Columbus. There is nothing like handing Buckeye Fans a Michigan card with every purchase. I actually saw this card on this site 3 months ago, and have been happy with it.
https://www.applyonlinenow.com/USCCapp/Ctl/entry?sc=VAA8BX&mboxSession=1322616991037-515735
I still have my AT&T Universal Card I signed up for my 1st month on campus in Ann Arbor.
I can't get rid of the f-ing thing; it has my highest credit limit with my longest credit history. My other CC is only a year old, and it's an Amex so I need a backup since some mom & pop places won't take Amex (and lot's of Europe).
While rummaging through old files (pre-internet electronic billing) a few weeks ago, I came across a dusty folder with old AT&T Universal bills. My wife and I both got these cards when we attended UM eons ago. I killed that bastard in the early 00's, but now realize I should've hung onto it and charged once a year to keep it active. The only balance I ever carried on it was my wife's engagement ring that I paid off in 2 months while working a summer job for UM summer camps. Good memories, even though I hated that card.
All I said was the card I use.
Amex is the best for service, and has decent rewards. Stay away from anything with a fee. Also, PennFed gives 5% back on gas, and 1% on everything else. Chase Freedom has 1% on everything and 5% on select categories. Get one of those cards, and pay off your balance.
Best bet to properly manage your credit card is to buy things on it, but not fully pay off the entire balance. You want a history of steady, regular, on-time payments. For a total bump in credit rating your best bet is to have more than one card, and get a small personal loan from a bank, say $1,000, and pay that off steadily as well, so you have multiple streams of different types of credit established.
I rock the credit union/debit card/only buy what you can afford approach, but whatever you sign up for, MAKE SURE YOU READ THE FINE PRINT!!!!
I was going to write about my experiences with my first credit card with Capital One, but then I remembered what I did when I was in your position. I found this site that compares all major credit cards (and then some) based on your search criteria. Behold, Nerd Wallet:
Interest on a credit card means you DOUBLE your balance EVERY 2-4 years depending on the rate and if you pay only the minimum balance.
Truly a license to STEAL.
I know I'm a little late to the party, but I was in a similar situation as you a couple years ago. I ended up going with a CapitalOne Platinum MasterCard. I get 1% cash back on all purchases, and they run specials where you can earn as much as 5% cash back at certain places. I started off with a $500 limit, but I don't remember my APR. Honestly, I didn't pay attention to that, since I knew I'd be paying off the balance each month. There is a $35 annual fee on it. I'm not loving it, but I've racked up over $100 in cash back, so the cash back has covered the fee. If you can get something without an annual fee, that would be the way to go. But I know when you're just getting started you don't have a ton of options.
I dumped cc's after I secured my mortgage with the exception of one that provides air miles as my wife is from Venezuela and 5 tickets to there costs me a gazillion.
I only buy good used cars and pay at least half on a down payment.
You have a ways to go but once you get a car note or two and mortgage screw the cc companies.
I also recommend banking at a credit union and using their cards.
Good Luck. Never be late on payments (even if minimum is all you can do). I wish I would have had a crystal ball to forsee FICO back when I was young.