Start Your Credit Score with the First Credit Card

Kimberly Watson, Editor in Chief
August 07, 2012 /

Your credit history begins with your first credit card and it is crucial that you are smart in using this credit facility from the beginning. The primary objective is building your credit score, but this for many is a relatively hard task.

As with any other type of record, building your credit score will usually start with a card bearing a high interest rate. In this case it is advisable to confine yourself to small purchases and make sure you settle outstanding bills within the given billing time. This not only saves you interest but displays responsibility to loan sources.

Once you are familiar with your first card and have become established to an extent, you could start receiving offers from providers of other cards at more competitive rates. These opportunities could be used in building your credit score and reputation, but make sure you pay within the time and your credit limits. Just one late payment could nullify any gains made from months of being a responsible card holder.

When application is made for a new source of credit you give permission to the loan provider to access your credit report. Each request for a report detracts slightly from your credit score, which is increased with every subsequent application. However, these detractions have a minor negative affect on building your credit score when compared to the upward surge of responsible card usage. This is enhanced by a long and trouble-free credit history.

Self financial control and management are essential in building your credit score. It is a guideline to your ability as a borrower and is something to be developed for the future.

 

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