If you’re a college student, it’s extremely likely that you had to take out at least one loan. College is crazy expensive, and even if you got generous scholarships or went to an in-state school, loans seem kind of inevitable. And unfortunately, this means that you’ll have some debt when you graduate.
If you’re trying to be money-conscious, getting a credit card might seem like a bad idea. Maybe you know someone who has thousands of dollars in credit card debt that they will literally be paying off for years–but this shouldn’t scare you from getting your own credit card. When used responsibly, it can actually make your life a lot easier.
Getting a credit card is an easy way to build good credit–something that will be important when you fill out an application for an apartment or a mortgage. You build good credit by paying your credit card bill on time and not carrying a balance. So if you don’t think you’ll be moving home after college, or are trying to get your own apartment, it might be a good idea to get a credit card.
There are SO many different kinds of credit cards, and it can totally feel overwhelming. As a general rule, opt for a credit card without an annual fee–you shouldn’t have to pay to spend your own money. Do some research and find a card that will work best with your lifestyle. If you spend the most money at the grocery store, find a card that gives you 3% back on groceries. If you feel like you spend all your money on gas, find one that gives 3% back at gas stations. This way, you’ll earn reward dollars on stuff you’re already spending money on.
You should get a credit card only if you have a steady source of income–like I said, the best way to maintain a good credit score is to pay off your full balance each month. Opt for a card with a low monthly spending limit, so you won’t be tempted, and make the payment in full at the end of the month. Also, you’ll probably need a steady income to get approved for a credit card in the first place.
If you do get a credit card, spend it like cash. Spending more money than you make in a month is the easiest way to fall into debt, and once that happens, it’s a pretty slippery slope.
So, if you want to build good credit and think that the benefits are worth having another bill to pay, I say go for it.