The beginner’s guide to credit cards


NEW-YORK – May 5, 2022 – (


iQuanti: Getting your first credit card can be exciting. But it can also be a little daunting, especially if you know people who have had credit issues in the past. So, to get you started on the right track, here’s everything you need to know about credit cards for beginners.

Why do you need a credit card in the first place

While having a credit card can be really handy, there’s a much bigger reason why you should have one: to try and help build your credit history.

Your credit history is generally considered a record of all the payments you’ve made to creditors over time. The quantification of these transactions is what is sometimes called a FICO score – a measure that lenders can use to assess your creditworthiness.

In other words, getting and using a credit card now can help you qualify for bigger purchases in the future, such as:

  • A house
  • A car
  • Insurance products

Therefore, you should consider having a credit card as an opportunity to prove that you are financially responsible.

How a credit card works

A credit card is basically a short-term loan that a financial institution gives to its users to make purchases. The amount of this loan (called your credit limit) may depend on various factors such as:

  • Sources of income
  • Debts
  • credit history

At the end of the billing cycle (approximately every 30 days), all purchases will likely be consolidated into one invoice and sent to the cardholder for payment.

The cardholder usually has two choices:

  1. Repay the balance in full
  2. Pay the minimum monthly payment (or a higher amount)

If the cardholder pays less than the total balance, they will “carry a balance”. Balances are often charged at the variable daily interest rate that was quoted when applying for the credit card (usually quoted as an APR or annual percentage). APRs are usually between 15 and 25%.

Each month these balances are carried forward may result in increased interest charges. They will also likely be added to the existing balance, which, in turn, will create even more interest.

When left unchecked, this process can lead to serious credit card debt. Therefore, the best action a cardholder can take is to limit their spending and pay off their balance in full each month.

What happens if my payments are late?

If a payment is late or less than the minimum amount due, the first thing that will happen is that you will most likely be charged late fees. This can be a penalty between $25 and $50 which is added to your balance.

More importantly, the missed payment can result in a negative mark on your credit history. This can quickly cause your credit score to plummet and possibly hamper your ability to apply for future credit cards or loans.

How to apply for a credit card

Applying for a credit card can be as simple as going online to the card issuer’s website and filling out an application. Before you begin, you’ll want to have some key information handy, such as:

  • Social Security number
  • Monthly or annual gross income
  • Recurring debts

If you’re just starting out, good beginner’s credit cards are usually “student” branded cards, as they can be more flexible on eligibility requirements.

If you are accepted, remember to always use your credit card responsibly. How you manage your spending and payments now will create money habits that you’ll stick with for a lifetime, so start building positive habits early on.

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The beginner’s guide to credit cards


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